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UPDATED: Bay Area retail powerhouse Mike's Bikes sold to Pon Group, the owner of Santa Cruz and Cervelo

Published August 18, 2021

NOVATO, Calif. (BRAIN) — Cross another retail chain off the list of the U.S.'s biggest independent bike retailers.

Mike's Bikes, the 12-store Northern California chain, has been purchased by Pon, the Dutch parent of Santa Cruz, Cervelo, Gazelle, Focus, Urban Arrow, and other bike, mobility, and auto brands. Pon also acquired Public Bikes, a city bike brand that Mike's bought in 2017

"The acquisition of Mike's Bikes aligns with Pon's strategy to expand its retail operations in North America by acquiring premier specialty retail brands in top markets," a statement from the company reads. 

The statement said that Mike's Bikes will be run independently from the other Pon companies and that Mike's Bikes former owners, Ken Martin (CEO) and Matt Adams (president), will remain with the company and continue with their day-to-day roles. Martin and Adams sold their shares in the stores' parent company, Headlands Holdings, to Pon Bike Holdings. Partner Mike Gabrys, who is no longer active in the business, also sold his shares. The parties are not releasing the sales price.

In a video shared with company employees, Martin and Adams emphasized that Pon has expressed little interest in managing or changing the way the business is run.

"Nothing is going to change around here. They like who we are and what we are and our culture and that's what they want," Martin said on the video. "If we didn't tell anybody, no one would know the difference." 

On the video, Adams said, "We were not purchased by Santa Cruz or Cervelo; We are under the same holding company (as those brands) ... we are still going to be mailing checks to Santa Cruz for our bikes and unfortunately we are not going to be getting any more special allocation of bikes than we already get."

Mike's currently carries Santa Cruz and Gazelle bikes, but not Cervelo. On the video, Martin said the stores would not necessarily be adding any more Pon brands. "Only if we want to. Pon doesn't force any of its companies to do business with each other ... it remains entirely our decision." 

Specialized is Mike's primary bike brand, accounting for a majority of the stores' bike sales, Martin told BRAIN.

Martin did not directly confirm that Trek and Specialized had tried to buy the business but said, "This was a long process involving several parties along the way."

"Pon is a great company. This isn’t just about the money, it's about partnering with someone who has same values as us, that allows us to remain independent and run the business, and provide the resources to get us to the next level," Martin told BRAIN. 

On the employee video Martin said, "We did not want to go private equity, we did not want to be acquired by a vendor like a Specialized or a Trek. That's why this is different: Because it's not a vendor acquiring us, it's a company that also happens to own vendors that is acquiring us. I think the best way to remain true to what we are and what we built is to have partner that owns the company that allows us to continue to build on what we've been doing all these years."

Mike's was included in our April story on the Big BRAIN Ten; industry consensus was that it was one of the 10 largest independent bicycle specialty retailers in the country. To our knowledge, the other nine retailers on the list remain independent, but in recent years several of the country's largest retail chains have been acquired, in many cases by Trek Bicycle.

Mike's stores are in Petaluma, San Rafael, Sausalito, San Francisco, Berkeley, Palo Alto, Los Gatos, Sacramento, Walnut Creek, San Jose, Pleasanton, and Folsom. The business was founded in 1964 in Marin County as a Schwinn dealer. Ken Martin, who at the time as a store employee, and partner Mike Gabrys bought the business in 1998 from then-owner Dave KaplanMatt Adams became an equity partner six years later.

Migndert Pon opened a retail store in Holland in 1867 that sold general goods including bicycles. The Pon business later began to import and distribute auto brands including Opel, Volkswagen and General Motors. Today the company remains owned by the Pon family and has more than 13,000 employees.

In addition to the brands mentioned above, Pon owns the Union and Kalkhoff bike brands, and has rights to the Raleigh, Derby and Univega brands in some markets. It also owns the BBB Cycling parts & accessories brand, several bike rental and share businesses, and a retail store in Amsterdam called Ride Out. Pon is among the top five largest bike manufacturers in the world.

In the auto world, Pon's indiGO group owns auto dealers in four U.S. markets. The dealers sell 11 luxury auto brands, including Porsche, Audi, Jaguar, Land Rover, Rolls-Royce, Bentley, Aston Martin, Maserati, McLaren, BMW and Lamborghini.

Topics associated with this article: Mergers, Acquisitions & Investments

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