SEATTLE, WA (BRAIN) — Divine Cycling Group International, Inc. has filed a Chapter 7 bankruptcy petition for DCG Wheels, the Seattle-based maker of Mad Fiber carbon wheels. Mad Fiber has been shut down for several months; Chapter 7 generally governs the liquidation of a company's assets.
In the petition filed in U.S. Bankruptcy Court in Delaware, the wheel company lists assets of $1.21 million and liabilities of $1.65 million. DCG owns more than 60 percent of the company, according to court filings.
DCG board member Brian Case was not immediately able to respond to a phone call from BRAIN on Tuesday.
DCG bought Mad Fiber last February; in the summer, Blue Competition Cycles and Serotta were added to the group. Blue later shut down (DCG said the purchase was never completed) and the Serotta brand has been shelved following the departure of founder Ben Serotta from the company. However the former Serotta factory in upstate New York is now being operated by Case, under the Saratoga Frameworks name.
Mad Fiber shut down operations at its Seattle factory early this fall. In a blog written soon after, co-founder Ric Hjertberg, an industry veteran, said, “I must confess my inability to understand why it had to happen.” Hjertberg left Mad Fiber in August.
Among more than 100 creditors listed in the bankruptcy filing is Composite Solutions, an Auburn, Washington, company owed $93,000. Part of that debt is secured by tooling that is still held by DCG Wheels.
Unlike Composite Solutions, most of the creditors are unsecured. They include employees and managers of the Seattle plant, investment groups, the IRS (owed $37,000) and the State of Washington Department of Revenue (owed $4,800). Several suppliers and local machine shops are trying to collect thousands of dollars, and the company lists about $40,000 in credit card debt. Among the investors listed as creditors is Kozo Shimano, the former president of Shimano American. He is owed $5,400.
The company also owed $9,500 to Competitor Group, the publisher of Velo magazine and other cycling titles, and $3,000 to Hi-Torque Publications, the publisher of Road Bike Action and other titles. It owes $28,000 to Thorpe Media, a Colorado marketing and PR firm.
Among the assets listed are $455,000 in machinery and equipment, $168,000 in inventory, $90,000 in receivables and $441,000 in “goodwill,” which apparently includes the value of intellectual property, trademarks, licenses and other intangibles.
A hearing is set for Dec. 30 in Delaware.