Vittoria Sold to Italian Fund Wise Equity

Jul 14, 2020
by James Smurthwaite  
Vittoria Tire Factory

Vittoria tires has been bought by Italian fund Wise Equity for a non-disclosed fee. Rudi Campagne, the current owner, will be retiring at age 79 in July, which allows Stijn Vriends of Wise Equity to take over as President and CEO. Campagne will remain on as non-executive in the Vittoria Board, and will become ‘honorary chairman for life’.

When Campagne first bought Vittoria in 1990, it was a much smaller company that employed fewer than 180 people. It has grown in the past 30 years to now employ 1,300 people and produces 7 million tires a year with annual sales of €60 million.

In recent years, Vittoria has invested heavily in six tyre factories in Thailand, which Mike Levy toured last year, where it produces tires for itself and other brands. Vittoria are also the only tyre brand that produces 4 compound tires and tires that use graphene with its Graphene 2.0 technology.

It's these graphene tires that Wise Equity seem most interested in, especially for e-bikes and urban bikes, and the news follows a recent claim from Vittoria that their graphene tires make e-MTB batteries last longer. Vriends said, "It’s more exciting than ever to be part of the ever-changing urban mobility landscape and our graphene tyre technology, developed for sport bicycles, can now become our dominant competitive edge in the urban bike category, as graphene tires are ideal for city-and-e-bikes, which need long endurance tires that don’t run flat."

Vittoria’s production & production development remains in Thailand, but it is now moving its European headquarters to a recently built €7 million office, test centre and warehouse in Bergamo, Italy. Campagne said: "Me and my partners eventually always wanted to bring the brand home to Italy, the cradle of the cycling world. Turning over the reins to Wise Equity therefore feels like the completion of a cycle."


  • 92 5
 Death by private equity in 3,2,1 . . .
  • 36 1
 First thing that goes is quality.
  • 16 0
 @HB208: cut corners for increased short term profit
  • 9 0
 @Rgdelgadillo: 100%. It doesn't matter what happens more than 4-5 years out because PE companies will hand it off to another PE
  • 4 1
 What could possibly go wrong? They do such good work by buying companies with pension fund money, trying to turn them around by changing the logo and spending a lot of money on offices.

  • 5 0
 First they will leverage the the brand and maximize their equity leveraging massive debt and turning it to a "zombie corp" where they cant generate enough revenue you to service their debt.

...then they go for your privates.
  • 58 1
 Private equity funds are only interested in producing profits, not tires. First blip in revenues and Vittoria is toast.
  • 11 6
 To produce profits, you need to produce tires, and good ones at that.
  • 16 3
 No they usually buy to break up assets and sell off.
  • 7 0
 @makripper: Interested in the Graphene technology says it all.
  • 3 6
 Been ok for Santa Cruz so far!
  • 2 1
 @enduroNZ: They're in the bike business for decades.......
  • 3 1
 Theese guys have made tires for decades @fat-hub:
  • 10 5
 @enduroNZ: has it? have you seen a 2020 bike in person? QC is way off. they are also failing at an elevated rate.
  • 4 0
 @Crossmaxx: No, you need to *have produced* good tires. Perceived quality is a lagging indicator, and exploitably so.
  • 1 0
 @Geochemistry: and the huge factory vittoria owns in Asia. Tons of manufacturing capacity there = $$$$
  • 3 0
 @enduroNZ: it's been awful for SC. Production delays like you wouldn't believe. Customers waiting 6-8 months for bikes after their deposits (that's pre covid - even worse now). Manufacturing has gotten worse by the year. The little "extras" that used to come with your brand new $8k bike are gone (not packaged with sealant or valve stems anymore, dont get the nifty little SC grease gun for your lower rocker anymore).
  • 2 0
 @makripper: There are many types of business and not all are like that. You can buy a relative small business to grow it,and then sell it.
In 2011 I worked for a small company. The first month I was there,we were buy by a big venture capital found. Now that company is worth like 60 times more than the 12 or 20 million they initially paid for us. So it could be positive too for those who have a job there.
  • 4 0
 I got sealant 3 bottles and 2 valve stems with my 2020 Bronson.... no delay. It was in stock. Ordered. Took 6 days ( order on Thursday came on Tuesday late bike shop stayed open to build it) and I was riding weds am. Customer service was great when I had an issue @Trudeez:
  • 1 0
 @Crossmaxx: or, just cut costs everywhere, claim massive profitability then flip to the next unsuspecting buyer!
  • 11 0
 Things will probably remain the same for a few years, then we’ll see what this big company wants to do with vittoria.

Good on Rudi Campagne for retiring though.
  • 47 6
 Its PE, the formula is pretty simple. Increase top line, cut all costs possible, keep company barely sustainable. Prepare for sale. If at any point, top line doesnt hit the mark, cut more cost. If all fails, exit brand.
  • 17 70
flag badbadleroybrown (Jul 14, 2020 at 13:22) (Below Threshold)
 @noplacelikeloam: You clearly have never been involved in any private equity deals... you sound like a bitter ex-employee that was sliding by somewhere and got cut after a takeover but, literally everything you just said is wrong.
  • 60 5
 @badbadleroybrown: Actually Ive been a corporate officer on both sides in 3 deals. And yes thats exactly how it goes.
  • 8 1
 @noplacelikeloam: you forgot the dividends.
  • 2 2
 @badbadleroybrown: Fully agree, PE deals is about profit, however it involves investing into the company and making it better company to re-sell or go on ipomoea;

there are few cases to move company out of the business, how've I doubt this will happen;

I would assume that means a lot of OEM deals in nearest future, probably MOTO line up, etc..
  • 16 25
flag badbadleroybrown (Jul 14, 2020 at 13:38) (Below Threshold)
 @noplacelikeloam: Except that it's not... but keep spreading the hate. You're clearly just embittered.The entire objective is to make a profit, which you don't get from just cutting costs. If you actually were involved in three deals and that's all that happened than you were with shitty acquisitions that were bought for a specific asset or IP and then chop, or with firms that didn't know what they were doing and are small players. Private equity is growth focus more than anything, which is why they're buying Vittoria; they're primed for growth.

Irrespective of that basic reality, the simple fact that their first move after buying the majority stake is to build a €7 million office complex in Bergamo to move the company to Italy says that "cut all costs possible" is just your bad interpretation of reality.
  • 2 4
 @nickmalysh: Yeah... What I read two days ago was that they were heavily interested in a pushinto more e-bike and commuter offerings to seize what they consider to be an undeveloped market, while continuing to try and take market share from more established brands like Maxxis and Conti in the dirt and on the road. Apparently they've already realized 15% growth from their 4c graphene and are looking to drive an advantage home while they're ahead on tech.
  • 3 0
 @badbadleroybrown: e-bike and e-bike commuters marked will experience triple digit percent growth over next 5 years, so it is nice strategy to invest in
  • 18 6
 @badbadleroybrown: dude, stop giving the hate here. If you dont know or havent been asked how to grow your bottom line by cutting your way to it, then youre a broker or an IB. Either way, sitting on the fence, watching an M&A deal operationalize after the fact isnt the same as being in it. So just back down on that one.

Next, if you think throwing money at real estate is a sign of long term investment growth in a brand, you are fooled by many. I can cite so many examples of organizations that have done this and bailed a 1years into the lease. So that argument is bunk.
  • 7 16
flag badbadleroybrown (Jul 14, 2020 at 14:24) (Below Threshold)
 @noplacelikeloam: I've actually been involved in a number of M&A deals and literally none of them have played out along the lines of your comically naive doomsday scenario.

And correcting your ignorance isn't "giving the hate"... but crying about a deal you know nothing about based on your bad experience sure is. I get it, you got bought out and kicked out and you're bitter. But you're reading about this today on Pinkbike and having a sook about it, I've known about since Friday and can say without any doubt that you don't have a clue wtf you're talking about.

PS - They're not buying a €7 million lease that they can walk away from in 1 year, they're dropping €7 million on building an office complex... so the only "bunk" argument is your's chief.
  • 12 7
 @badbadleroybrown: Why on earth you think I was kicked out of a deal or bought out is beyond me, but ill let you cry about that one. My bank account says differently. ;-)

Comically naive? If you actually finished your MBA or wrote a few papers in M&A integration you would know that the number of M&A deals that fail is 65% to 90%. So while Im sorry my response was negative, thats just the reality of the M&A world, its tough and PE by its nature is one the most unforgiving.

And PPS - By landing and building a 7M office is a smart investment anyways. There are good case studies out there including Nike, VF that show this done recently, who both walked away with a healthy profit just on the land value alone. Consolidation of real estate, medium term investment, good use of capital, cheap when amortized and a stable mid- long return in a current volatile market. So no it doesn't mean they are in the for the long run. They are just cleaning up and looking for a buck along the way.
  • 6 22
flag badbadleroybrown (Jul 14, 2020 at 14:49) (Below Threshold)
 @noplacelikeloam: Your bank account doesn't say anything, but your bitterness and unrealistic perception really says all that need be said. You sound like the ex-boyfriend crying about what a bitch some chick is after she dumped your ass.

And the failure rate for M&A deals isn't very relevant to a deal that didn't fail. Really very little changes... Vittoria was bought by the current ownership in a smaller private equity deal in 1990, sure didn't ruin the company then now did it? But you're sitting here whining as though you have any insight, when in reality you don't know anything.

PPPS - Nice back pedal trying to cover for you ignorantly claiming that they were leasing property an hour ago to now pretending like you had a clue what you were talking about and what a smart investment you knew it was... I guess you're gonna pretend like you knew that they've also negotiated a collaboration with Graphene Flagship and are currently courting multiple additional advanced chemical suppliers, expanding capital investment rather than constricting it, as well huh?

Seriously... you may impress the Pinkbike botnet with your ignorance but you honestly know f*ck all about this deal. If you're half as integrated into the market as you're desperately trying to pretend to be, I suggest you make some calls, do some research, and figure out just how stupid you sound.
  • 16 3
 @noplacelikeloam: I'm with you on this one, I've worked for a couple of companies while they have been bought out, the first things that happen are 'performance managing' as much staff out as possible, closing offices/branches and departments and handing the work load over to existing staff, then freezing all pay and changing management around so the ones running the show have no experience or any idea what they're doing and can be easily be told what to do by the upper level... then when the numbers look good on paper the company gets sold... haven't ever seen it any other way
  • 15 3
 @badbadleroybrown: Im not trying to impress anyone here, this is a frickin bike website! Just chill and stop trying to preach its a good deal when you also have not the first clue on what the deal is and never will do. Im not saying this is doomed, but an acquisition of this kind comes with direct commercial expectations and a limit to the patience of its investors. Most founders I know have changed their perception of VC and PE money from where it was a few years ago and most dont want it anymore. Im sorry but too many have been burned.

Real estate can be a short term lease or buy investment. Aside from cash, makes no difference. M&A failure isnt about the deal. For the love of god, the deal is at best a guess at the future. M&A fails due to due diligence yes, but more-so operational and integration issues that occur way after the deal has occurred.

Not trying to argue here dude. Maybe just agree to disagree and argue about bikes or some other stuff.
  • 15 3
 @badbadleroybrown: business textbooks are literally full of examples where publicly traded companies cut costs at the expense of quality to boost margins. Most of the time it's the board putting pressure on a ceo to increase the share price. Not sure what rose coloured glasses world you're living in.
  • 14 2
 @badbadleroybrown: Sorry, have you not seen the Yeti Tribe comment section? You can’t call him Chief.
  • 10 1
 I hope this doesn't kill my favorite tire manufacturer.
  • 4 0
 Gonna have to stock up on Corsa tires!
  • 4 0
 Dang, their MTB tires are really starting to get super good. I've been hugely impressed with their latest line. I hope this doesn't mean the end of that. I gotta think this is more about the tire factory and manufacturing vs the actual tires themselves. I worry that the products will suffer in favor of production volume.
  • 2 0
 Besides mountain biking, I personally commute around 9000km to work and back (That is 5592.341miles for those of you not privileged enough to be able to work in km) Razz per year and if they did a long lasting, tough commuter tyre I would be really excited!
  • 1 0
 I'm interested and nervous to see where this takes Vittoria. I like their tires and they've been heading in the right direction. I hope that means this private equity firm recognized some long term potential and isn't looking to just wring the company dry.
  • 7 3
 As long as they keep producing my beloved Aggaros.
  • 2 0
 Agreed! Barzo is my favorite tread of all time.
  • 4 0
  • 7 3
 RIP Vittoria
  • 4 0
 death by LBO
  • 4 1
 Another zombie brand is coming. Sad.
  • 1 1
Dire che la ditta è italiana ed avere gli stabilimenti in Asia la dice tutta!
Saying that the company is Italian and having the factories in Asia says it all!
  • 2 0
 I really love my mezcals i hope they dont mess them up.
  • 2 0
 12-18 months we'll be reading a story along the lines of Mavic.
  • 7 6
 Italy, the cradle of the cycling world. You learn something new every day.
  • 4 8
flag rivercitycycles Plus (Jul 14, 2020 at 13:22) (Below Threshold)
 @vinay. If Italy is the cradle what is Marin County?
  • 9 4
 For road cycling, one could argue it is. PNW/BC is certainly the cradle of the MTB world. Except that Bentonville is the self proclaimed MTB Capitol of the World, so maybe not.
  • 9 0
 Bianchi is regarded as the oldest bicycle manufacturer...
  • 7 0
 @rivercitycycles: the dirty hole where you can’t actually ride?
  • 11 0
 @rivercitycycles: The hairy hippy armpit.
  • 1 0
 @rivercitycycles: a hemorrhoid?
  • 1 2
 @rivercitycycles: It may come as a surprise but the mtb used in the 70s in the USA are very similar to the bikes used by "Alpini" in the 10s
  • 2 0
 Well that sucks
  • 1 0
 a great gathering of economy genius
  • 2 1
 mmm said by a Greek ...
  • 1 0
 1300 people? Wow. I very much underestimated the size of Vittoria!
  • 1 0
 As long as somebody keeps producing the air liners I’m happy.
  • 1 0
  • 2 2
 Is it tyre or tire?
  • 5 0
 The English-speaking world bar the U.S. and Canada spell it tyre. No idea why the U.S. and Canada use tire instead.
  • 11 1
 @NatusEstInSuht: We be dumb.
  • 6 1
 @GBeard: But these colours don't run.
  • 2 0
 @endlessblockades: #sarcasm. It is just funny that both tyre and tire are used in the article.
  • 3 0
 @tacklingdummy: I didn't even notice that - good catch. Def an editorial inconsistency. I read as far as Rudi Champagne retyred....doesn't really concern me.
  • 2 2
 @endlessblockades: Us not native English speakers/writers usually try to adapt to the audience. When I'm responding to a US person, I'd say tire, armor, color etc. When responding to an Australian or British person, I'd say tyre, armour, colour etc. James is British as far as I know but I can imagine he must have been looking up different sources when he wrote this article so I can imagine he was confused.
  • 1 0
 @vinay: Why bother, just speak the Queen's English and be done with it Smile
  • 2 0
 @korev: the Boston Tyre Party
  • 1 4
 Looks like a Minion.

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