Youngone Corp. invests $176 mn in bike company Scott

[Courtesy of Scott]

South Korean outdoor apparel maker Youngone Corp. has made an additional investment of 150 million Swiss francs ($176 million) in its affiliate, Swiss premium bicycle brand Scott Corp SA, to expand its eco-friendly outdoor business beyond its primary focus on original equipment manufacturing (ODM) for clothing.

Youngone announced on Sunday that it had decided to make an investment in the form of a loan to its overseas affiliate at the end of 2023. “We are providing financial support through a monetary loan to secure additional liquidity for Scott and improve its financial structure,” the company said.

Scott is a premium bicycle brand founded in 1958 in Switzerland, specializing in the manufacture and sale of sports equipment such as mountain bikes, ski poles and motorcycle gear on top of sportswear. It has expanded to over 60 countries, including North America and Europe, and recently made an imprint in the European electric bicycle market.

Youngone acquired a 20 percent stake in Scott in 2013 and increased its stake to 50.1 percent in 2015. The amount invested by Youngone to acquire its stake in Scott is approximately 154.5 billion won ($117.6 million).

With the global bicycle market contracting and demand slowing down after the Covid-19 pandemic, Scott’s performance has declined. The company’s cumulative operating profit for the first three quarters of 2023 was 55.8 billion won, a sharp decrease of 59.94 percent compared to the same period the previous year.