Odyssey backs Australia mountain bike business

The size of the deal was not disclosed. It is the sixth investment from the private equity firm’s debut fund, which closed at A$275 million ($212 million) in 2017 and writes checks of A$15-40 million for Australia and New Zealand-based companies with enterprise valuations of up to A$100 million. It takes minority and majority positions.

Odyssey said it would commit additional capital to MTBD to support growth and help the company build on its customer offering. MTDB’s founders are also participating in the deal.

The business originated from a premium mountain bike store in Brisbane established by cycling enthusiasts Michael Geale and Tim McCullough. Both of their wives, Jen and Mel, participate in management. MTDB launched in 2012 as a pureplay online destination for mountain bikes. It has expanded into New Zealand and wants to enter other geographies.

“At MTBD, we combine a real passion for the sport and the industry with a well-developed understanding of our customer. Leveraging our background in running physical bike shops, we have been able to create a high-quality digital customer service experience,” said CEO Jen Geale, in a statement.

According to Sport Australia, cycling is the country’s fifth most popular sporting activity, with 2.36 million participants in 2019. Overall participation in cycling has been declining for several years. However, it rebounded in 2019, with 35% of respondents in the National Cycling Participation Survey saying they had been on a bike in the past year. Recreation is the most common purpose.

There were increases in bicycle sales across multiple markets globally in 2020 as COVID-19 spurred an aversion to public transport, led to gym closures, and encouraged people to focus on healthy living.

Australia’s bicycle market, including parts and accessories, was worth A$780 million in the 12 months ended June 2020, Australia-headquartered cycling marketplace BikeExchange said in its IPO prospectus. Approximately 1.2 million bikes were sold, with specialist retailers accounting for 400,000. It is estimated the bicycle retail market will hit A$806 million by 2025.

Odyssey was established by three former CHAMP Ventures executives – Gareth Banks, Jonathan Kelly and Paul Readdy – and George Penklis, a co-founder of Quadrant Private Equity. Other portfolio companies include women’s fashion footwear label Frankie4, rural services provider Delta Agribusiness, Japanese food retailer Sushi Sushi, mining services business Minesite Technologies, and Adventure Operations, which owns a portfolio of outdoor and camping equipment brands.

Deloitte Corporate Finance advised the founders of MTDB on the transaction.

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• Topics
• Australasia
• Consumer
• Buyouts
• Australia
• Odyssey Private Capital