Dorel Indicators Definitive Settlement to Promote Sports activities Phase to Pon Holdings for USD $810 Million

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MONTREAL, Oct. 11, 2021 (GLOBE NEWSWIRE) — Dorel Industries Inc. (TSX: DII.B, DII.A) at this time introduced that it has entered right into a definitive settlement to promote Dorel Sports activities, its bicycle phase, to Pon Holdings B.V., a Dutch mobility group, for US $810 million in money, representing roughly CAD $1 billion, payable to Dorel at closing.

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Dorel expects to make use of the web proceeds from the sale of roughly US $735 million (topic to closing changes) to scale back indebtedness, return capital to shareholders and for normal company functions. The sale of Dorel Sports activities is anticipated to shut earlier than the tip of the primary quarter of 2022. Dorel intends to announce particular particulars relating to using the web proceeds from the sale on the time of closing.

The sale has been unanimously authorised by Dorel’s Board of Administrators and is topic to customary closing circumstances, together with receipt of relevant regulatory approvals and the absence of any materials hostile adjustments with respect to Dorel Sports activities till closing. The sale will not be topic to any financing circumstances. The transaction will encompass the sale by Dorel of 100% of the shares of its oblique wholly owned subsidiary corporations comprising Dorel Sports activities in addition to sure associated belongings. Beneath relevant company legislation, the transaction will not be topic to approval by Dorel’s shareholders.

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“Performing on suggestions from our shareholders, Dorel launched into an intensive evaluate of strategic options earlier this yr. Our goal has persistently been to create worth for our shareholders. The divestiture of Dorel Sports activities represents a novel alternative to unlock worth by capitalizing on robust demand for scaled belongings within the bicycle phase,” stated Martin Schwartz, Dorel President and CEO. “On behalf of the Board of Administrators, I lengthen my honest due to all the Dorel Sports activities workforce for his or her excellent efforts over time. Dorel Sports activities has been an essential a part of our group since 2004 and we’re very pleased with the worldwide success it has achieved. Whereas making the choice to promote Dorel Sports activities has been troublesome, we’re assured that this transaction represents full worth for Dorel shareholders,” Mr. Schwartz added.

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Worth Surfacing for Dorel Shareholders

The definitive sale settlement with Pon Holdings follows a strategic evaluate and a aggressive gross sales course of. Dorel believes that the 100% money transaction will crystalize vital proceeds and can unlock the complete worth of the Dorel Sports activities enterprise for Dorel shareholders. Dorel additional believes that the curiosity in Dorel Sports activities expressed through the strong gross sales course of displays the wonderful work by the Dorel Sports activities workforce to enhance profitability, acquire new prospects and improve the working construction and value profile of Dorel Sports activities.

Subsequent Chapter for Dorel

The settlement to promote Dorel Sports activities marks an thrilling new chapter for Dorel. Dorel believes that the sale of Dorel Sports activities will strengthen Dorel’s stability sheet, enable Dorel to concentrate on producing earnings from its remaining companies, considerably speed up Dorel’s means to deleverage the enterprise and place Dorel to develop its House and Juvenile companies each organically and thru value-accretive tuck-in acquisitions. Going ahead, Dorel will focus its power and assets on persevering with to ship worth to shareholders by accelerating development and driving margin enlargement in its market-leading House and Juvenile companies. With a stronger stability sheet after the shut of this transaction, an industry-leading portfolio of manufacturers and merchandise, robust buyer demand and rising end-markets, Dorel believes it is going to proceed to compete from a place of power.

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“Dorel is dedicated to taking a disciplined strategy to worth creation because it sees vital upside in each its House and Juvenile companies and can look to duplicate the success it has achieved with Dorel Sports activities to create further worth for shareholders. To be clear, right now, we’re not pursuing a monetization of our House and Juvenile segments. We see alternatives to drive top-line development in addition to initiatives to scale back our general price construction to enhance our cash-flow era at each segments,” stated Martin Schwartz. “We now have the proper administration and technique in place at each companies to drive robust leads to the medium-term. We are going to re-assess our technique as required. Whereas we could retain some capital from the sale of Dorel Sports activities for potential reinvestment alternatives, we at the moment intend to scale back monetary leverage and return capital to shareholders,” Mr. Schwartz added.

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Close to-Time period Challenges in House and Juvenile Segments

As in lots of industries, the uncertainty of provide stays a key concern for Dorel’s House and Juvenile companies. The demand for container freight continues to push up prices and is hindering Dorel’s means to fulfill persevering with robust shopper demand for its merchandise. As well as, the impact of the COVID-19 pandemic in numerous elements of the world and labour availability for Dorel and its stakeholders are elements with which Dorel is contending. Dorel’s means to efficiently handle these points with its vendor and retailer companions shall be very important to its means to ship sooner or later. Within the House and Juvenile segments, inflation and a extremely confused provide chain are forcing Dorel to scale back its outlook from that in its August 6, 2021 press launch.

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Dorel will announce its third quarter, 2021 outcomes on November 5^th, 2021, previous to the opening of monetary markets.

Advisors

Baird International Funding Banking and BMO Capital Markets are appearing as monetary advisors and Fasken Martineau DuMoulin LLP as authorized counsel to Dorel and Lazard is appearing as monetary advisor and Goodmans as authorized advisor to Pon Holdings in reference to the sale of Dorel Sports activities.

Profile

Dorel Industries Inc. (TSX: DII.B, DII.A) is a world group, working three distinct companies in juvenile merchandise, bicycles and residential merchandise. Dorel’s power lies within the range, innovation and high quality of its merchandise in addition to the prevalence of its manufacturers. Dorel Juvenile’s powerfully branded merchandise embrace international manufacturers Maxi-Cosi, Quinny and Tiny Love, complemented by regional manufacturers corresponding to Security 1st, Bébé Confort, Cosco and Infanti. Dorel Sports activities manufacturers embrace Cannondale, Schwinn, GT, Mongoose, Caloi and IronHorse. Dorel House, with its complete e-commerce platform, markets a large assortment of domestically produced and imported furnishings. Dorel has annual gross sales of US$2.8 billion and employs roughly 8,200 folks in services situated in twenty-five nations worldwide.

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Warning Concerning Ahead-Trying Statements

Sure statements included on this press launch could represent “forward-looking statements” throughout the that means of relevant Canadian securities legal guidelines, together with, with out limitation, statements relating to the proposed sale of Dorel Sports activities to Pon Holdings B.V. and using the proceeds from such sale, together with doable return of capital to shareholders. Such forward-looking statements are topic to essential dangers and uncertainties together with, with out limitation, approval of the proposed sale of Dorel Sports activities by relevant governmental authorities, satisfaction or waiver of closing circumstances contemplated by the Share Buy Settlement with Pon Holdings, adjustments in relevant legal guidelines or rules, and selections by Dorel regarding using the web proceeds from the proposed sale of Dorel Sports activities. The completion of the proposed sale of Dorel Sports activities to Pon Holdings is topic to sure circumstances, termination rights and different dangers and uncertainties. Accordingly, there will be no assurance that the proposed sale of Dorel Sports activities to Pon Holdings will happen or that it’ll happen on the time or on the phrases and circumstances at the moment contemplated, nor can there be any assurance as to the advantages that Dorel will derive, or as to using the web proceeds, together with doable return of capital to shareholders, from the proposed sale. Besides as could also be required by Canadian securities legal guidelines, Dorel doesn’t undertake any obligation to replace or revise any forward-looking statements, whether or not on account of new info, future occasions or in any other case.

CONTACTS:
Saint Victor Investments Inc
Rick Leckner
(514) 245-9232

Dorel Industries Inc.
Jeffrey Schwartz
(514) 934-3034