Dorel Industries Inc. sprinted to the front of the U.S. bicycle industry Tuesday with a $310-million deal to buy Pacific Cycle, makers of the well-known Schwinn brand.
The Montreal-based maker of furniture and children's products including car seats and baby strollers said it would buy Wisconsin-based Pacific Cycle, the biggest seller of bicycles in the U.S., in an all-cash deal.
Dorel said its agreement with Wind Point Partners, a private U.S. equity investment firm, would be financed with additional debt. The deal is expected to close later this month.
"For Dorel, I think it's a fit," said John McIlveen, retail analyst for Salman Partners Inc.
"On the surface, bicycles may not seem like a fit, but Dorel is a consumer products [maker] that distributes through mass-merchant channels products manufactured in Asia, so that fits this bill."