NINER files for Chapter 11

[Mikej]

Wow, I thought they had a good model.http://www.bicycleretailer.com/industry-news/2017/11/29/niner-files-bankruptcy-ahead-planned-sale#.Wh8q0WeWxPY

[Mark McM]

Sounds like a "strategic" bankruptcy.

Company looking for outside investment.

Buyer expresses interest in buying company.

Buyer wants company assets, but doesn't want company debts.

Buyer agrees to buy company, but only if they declare bankruptcy first.

Company declares bankruptcy.

Debt to suppliers is forgiven during bankruptcy process.

Buyer buys company at fire sale price to attain assets.

Suppliers left holding the bag for debt.


Isn't America great?

[Lanternrouge]

They filed with assets exceeding liabilities and with five of the past years showing a profit. Bankruptcy can be a fascinating tool to achieve business goals that might not be as easily (or at all) achieved. It's really interesting stuff.

[Hindmost]

I am guessing that there are some missing pieces to the story. Bankruptcy followed by acquisition is an odd way to fund R&D.

[Dave B]

Well I love their bikes, but if the girl at the other end of the emails I spoke with numerous times is in charge of stuff I can see why they went bankrupt. I don’t get attitude in the retail industry.

I sure hope they keep making awesome bikes, but maybe a shift in staff is needed.

[gdw]

You must have caught her on a bad day or days.. I've dealt with their customer service reps on a number of occasions over the past several years and they have been very helpful.

[Gummee]

Bikerunor is saying they're sold already...

I'm confused

M

[Dirtdiggler]

They should start a new company 27.fiver

[Dude]

@mark mcm that sounds right and dastardly. I hope they have endless insomnia trying to sleep on their piles of money.

[dustyrider]

I was never able to find relevancy in higher math beyond geometry, and since my father would not let me drop out of high school, I took lots of business math and finance classes. I’ll never forget the lesson our teacher cooked up which essentially walked us step by step through the process that markMcM outlines.

In other words: There’s profit in bankruptcy!

[FlashUNC]

They owe someone some cash they don't want to pay back going forward. I doubt whoever they're trying to bone goes away quietly in the Resolution process.

There's way more to this story, but there always is with a strategic Chapter 11 like this. (I mean, every Chapter 11 is strategic from a particular point of view.)

[jlwdm]

@mark mcm that sounds right and dastardly. I hope they have endless insomnia trying to sleep on their piles of money.

There are no indications this is the case.

Jeff

[OldCrank]

<<< whoever they're trying to bone >>>>

Ummm, Taxpayers, AFAIK

[rwsaunders]

They filed with assets exceeding liabilities and with five of the past years showing a profit. Bankruptcy can be a fascinating tool to achieve business goals that might not be as easily (or at all) achieved. It's really interesting stuff.

It’s interesting unless you’re one of the suppliers left holding the proverbial bag so that Niner can “achieve their business goals”. It looks like their president saw it coming as he just switched jobs recently.

http://www.bicycleretailer.com/north-america/2017/11/13/look-cycle-group-hires-mike-gann-vp-sales-and-marketing-us#.Wh9AqGJOmaM

[bking]

Sounds like a "strategic" bankruptcy.

Company looking for outside investment.

Buyer expresses interest in buying company.

Buyer wants company assets, but doesn't want company debts.

Buyer agrees to buy company, but only if they declare bankruptcy first.

Company declares bankruptcy.

Debt to suppliers is forgiven during bankruptcy process.

Buyer buys company at fire sale price to attain assets.

Suppliers left holding the bag for debt.


Isn't America great?

You left out the really pathetic part:

Then the same Suppliers fall in line with the "new" company to offer parts on credit again...and again...and...

[Dave B]

You must have caught her on a bad day or days.. I've dealt with their customer service reps on a number of occasions over the past several years and they have been very helpful.

You know you are probably right. I cannot seem to mature to the point that interactions with others that go poorly don’t color my opinion. I love their bikes just fine, but just wish the folks I interacted were having a better day.


Or I could grow up. :hello:

[sales guy]

The sale of Niner is planned with the Bankruptcy being first. It's strategic. I have heard it might be screw certain people out of a rightful share/payment while additionally screwing over numerous vendors/suppliers. The have 9.7mil in assets and 7.9mil in debt. and they've made profits 5 out of the last 6 years. sounds odd that they need an investor/buyer but i don't know their books. I do know by people who deal with them, they have a ton of warranty issues. I've always loved the looks of the bikes. They did it right or at least did something right.

[Lanternrouge]

I do know by people who deal with them, they have a ton of warranty issues.

This will likely eliminate any further liability for warranty issues.

[sales guy]

This will likely eliminate any further liability for warranty issues.

Sadly yes. That's gonna suck especially for people who just bought bikes/frames cause places are blowing them out right now.

[PaMtbRider]

Strategic chapter 11 sounds like a real ****ty thing to do. I considered one of their bikes until I heard of this. I'll gladly pay a little more and support a company / business / individual builder, that has a better business ethic for my next bike.

[cmg]

so what keeps the guy that owns 68% from getting fired by the new owners? the vendors that lost on their debt write it off, continue to offer debt and go on? sounds familiar, jump on the sinking boat.

[binxnyrwarrsoul]

This will likely eliminate any further liability for warranty issues.

Boom.

[Dirtdiggler]

Seems Niner were doing well when 29 wheeled bikes were the only format to buy instead of 26, but when 27.5 format showed up, well that took a chunk of their business. The past Niner president use to work at Titus and that company went belly up.. I hope LOOK knows what they are doing..

[sales guy]

Strategic chapter 11 sounds like a real ****ty thing to do. I considered one of their bikes until I heard of this. I'll gladly pay a little more and support a company / business / individual builder, that has a better business ethic for my next bike.

It is. And it happens WAAAAAAY too much not just in the bike world. Tho we get hit really hard since bikes are so consumable.

so what keeps the guy that owns 68% from getting fired by the new owners? the vendors that lost on their debt write it off, continue to offer debt and go on? sounds familiar, jump on the sinking boat.

I know one of the owners and spoke to him about this last night. Questioning if he might get shut out of anything owed to him. He is trying to figure that out given yesterdays notice. He isn't sure yet. He is hoping too of course. I just took and apologized over the whole thing. Cause it's his baby dying and he's pretty crushed.

Seems Niner were doing well when 29 wheeled bikes were the only format to buy instead of 26, but when 27.5 format showed up, well that took a chunk of their business. The past Niner president use to work at Titus and that company went belly up.. I hope LOOK knows what they are doing..

The Titus thing, they had issues for many many years. Technically, both versions did. They made out in the end of course since Chris has Pivot now and is doing well. But it's a really common problem in the bike world. It's such an easy thing to get into and very consumable in many ways. With the whole 27.5 and then 27.5+ blowing the market away, i can see how they'd lose market share. But they still had a huge following. They were making money. I think the Ch 11 is totally personal/strategic. And if that's what the buyers wanted to make it happen, sometimes sellers will do whatever just to finish it. Which again is sad. We'll see how it plays out in the next few months.

[mcteague]

https://www.bikerumor.com/2017/11/28/niner-bikes-sells-private-investor-group-fuel-growth-keeps-team-intact/

Tim

[peanutgallery]

Have a riding buddy with a 2014 Rip 9, he went to service the suspension bearings as a result of use this past summer and a pair of them fell out in his hand. They tabs that they were installed in on the swingarm were mismanufactured and not aligned so the steel of the bearing casing wore thru the aluminum until they were aligned, hence the slop in the suspension. Long story short, 24 month warranty and no replacement swingarm available for purchase as the design had been modified a year or so ago. He had a receipt and it was from a brick and mortar. Only option was the purchase of a new frame which Niner gladly sold him. My riding buddy is a sucker

From a bigger perspective (IBD) I don't see the draw of the brand as result of so much of their product winding up on the blowout sites of the interwebs while those that bought in are left holding the bag so to speak. Screwing over their vendors so that they can design ladies and kids bike doesn't fix the above issue. There are better niche MTB brands that are straighter shooters

Bike industry is pretty small, I don't see Niner getting a lot of rope after all this

[sales guy]

Have a riding buddy with a 2014 Rip 9, he went to service the suspension bearings as a result of use this past summer and a pair of them fell out in his hand. They tabs that they were installed in on the swingarm were mismanufactured and not aligned so the steel of the bearing casing wore thru the aluminum until they were aligned, hence the slop in the suspension. Long story short, 24 month warranty and no replacement swingarm available for purchase as the design had been modified a year or so ago. He had a receipt and it was from a brick and mortar. Only option was the purchase of a new frame which Niner gladly sold him. My riding buddy is a sucker

From a bigger perspective (IBD) I don't see the draw of the brand as result of so much of their product winding up on the blowout sites of the interwebs while those that bought in are left holding the bag so to speak. Screwing over their vendors so that they can design ladies and kids bike doesn't fix the above issue. There are better niche MTB brands that are straighter shooters

Bike industry is pretty small, I don't see Niner getting a lot of rope after all this

To the first part, I hear that from quite a few people.

The second part, yeah, it is a really small but amazingly everyone forgets or just doesn't care after a bit. It's kind of odd. I know quite a few people who've screwed over companies and they are still around and "respected". Other than with dealers, and unless they do not cover past sales, THEN they will have problems.

[peanutgallery]

Ski industry is also filled with hucksters, I don't get it

Niner may as well go consumer direct as they are halfway there, no dealer in their right mind will touch them. Just reward would be Chris Suguai holding the bag filled with warranty, angry customers and severely devalued product. He's dished it out, that's for sure. Don't see this arrangement lasting too long

To the first part, I hear that from quite a few people.

The second part, yeah, it is a really small but amazingly everyone forgets or just doesn't care after a bit. It's kind of odd. I know quite a few people who've screwed over companies and they are still around and "respected". Other than with dealers, and unless they do not cover past sales, THEN they will have problems.

[54ny77]

rebrand it to "11'ing."

[dddd]

"Gann has held several executive positions within the industry, working for American Bicycle Group, Titus Cycles, and Advanced Sports Inc. Most recently he was president of Niner Bikes for the past two years; he was with Niner for a total of six years."

Something about that group of employers seems to be ringing a bell, but I didn't see Serotta listed so...

[likebikes]

i think you're thinking of divine cycling group.

[fiamme red]

Niner acquired by investment firm Emersion (http://www.bicycleretailer.com/north-america/2018/02/20/niner-acquired-investment-firm-emersion#.WoyKDqjwa70)

[54ny77]

Be kinda funny if they rebranded as 11er.

[.RJ]

Suppliers left holding the bag for debt.


Isn't America great?

That's not how Chapter 11 bankruptcy works. Not even a little bit.

I'm a big Niner fan, I think I've bought 7 or 8 framesets, but they havent really kept up with modern mountain bike development IMO - perhaps they didnt have the cash to invest in R&D or re-tool in the factories. I'm interested to see how this plays out, but I suspect even with the new owners they're at least a year or two out from releasing any new models. With their lineup right now, there isnt anything there that I'd like to buy.