MONTEREY, Calif. (BRAIN) — Kent Outdoors, which acquired Kona Bikes from its founders in 2022, said Friday that after a strategic review it has decided to sell the bike brand.
The move comes after Kona became the talk of the industry by setting up an expo tent prior to the Sea Otter Classic and then breaking it down and leaving the event before it opened. The news also comes as Kent announced a new CFO and a new $100 million credit facility from Eclipse Business Capital, an asset-based lender.
"This move (selling Kona) allows the company to direct its resources toward investment in its key water sports businesses. The bike industry has faced very significant challenges in the post-COVID world and Kona has not been immune to these headwinds," the company said Friday.
"Within the Kent Outdoors family of brands, we pride ourselves on a robust legacy characterized by resilience and an unwavering ability to overcome hurdles, consistently emerging stronger in the face of adversity," said C.J. Vlahovich, who leads Kent's Watersports division. "While the path to improvement has been demanding, our devoted team remains steadfast in our conviction that Kent Outdoors is destined to continue as the foremost innovator in cultivating vibrant brands that elevate outdoor enjoyment for all."
Kent said the new credit facility follows recent investments from Goldman Sachs and Comvest Partners. "These investments are critical to the Company's efforts to implement a strategy for future growth and success as it continues to market innovative new products for outdoor enthusiasts and adventure seekers," the company said.
A year and a half after announcing the acquisition by Kent, Kona announced a new consumer-direct sales program that many U.S. dealers found objectionable. Last October Kent said it was relocating its corporate headquarters from Ohio to Utah. It said some Kona employees would work out of the Utah office, although the bike brand maintained a presence in its longtime hometown of Bellingham, Washington.
In recent months Kona has advertised deep discounts in its consumer-direct program, including a buy-one-get-one free promotion.
Kent Outdoors is no relation to Kent International, the New Jersey-based mass market bike maker. Besides Kona, Kent Outdoors owns outdoor brands including Arbor Snowboards, O'Brien, Freedom Foil, Aquaglide and BOTE.
Kent announced Thursday that it had hired Rob Ottoto as chief financial officer.
Otto recently completed the sale of RW Designs, where he served as the company's chief financial officer and chief operating officer. He has held CFO and COO positions at companies such as Z Gallerie, Hudson Jeans, Seven For All Mankind, and Affliction Holdings.
"Kent possesses some of the most recognized names and brands in the industry and it is my goal to ensure the company remains an industry leader while enhancing operational capacity and processes to ensure our facilities and people are operating at their peak," said Otto.
