3 February 2015

Paragon sells POLO Motorrad

POLO Motorrad is a leading multi-channel retailer for motorcycle clothing, accessories and equipment in EuropeThe company was successfully reorganised and has returned to sustainable growth since its acquisition out of insolvency in April 2012. The transaction is subject to regulatory and competition clearances.

Paragon, and its minority co-investors, Tempus Capital and SM Investment Ltd., sold its shares in POLO Motorrad und Sportswear GmbH to funds advised by Equistone Partners Europe, for an undisclosed amount. POLO Motorrad is a leading provider of motorcycle clothing, accessories and equipment in Europe. The company operates eighty-two stores in Germany and seven in Switzerland, and has 800 employees. POLO Motorrad also distributes its products via its online shop, mobile applications and business to business channels.

The company has been successfully restructured and reorganised during the last three years under Paragon majority ownership and its minority co-investors, in conjunction with the management team, led by Michael Kern (CEO). Since insolvency in 2012, the principal developments achieved include the appointment of a new management team and the establishment of a professional corporate governance structure. The company has since repositioned and strengthened its proprietary brands, streamlined and redesigned the assortment of products available and increased productivity by process-related and methodical professionalization of all functional areas including procurement, sales, marketing and finance. These measures led to a strong growth in revenues and a sustainable increase in profitability. In the past financial year (October 2013 to September 2014) POLO Motorrad generated revenues of around € 114 Million with approx. 800 employees.

In addition, major investments supporting the future growth of the company have been made such as the establishment of the POLO academy, the implementation of a new Customer Relationship Management (“CRM”) system and the reorganisation of online marketing activities.

Marco Attolini, managing partner at Paragon, commented: “We acquired POLO Motorrad out of insolvency in 2012 and want to thank the management team, all POLO Motorrad employees as well as our co-investors for their help in the successful development of the company. Now is a good time for a change of ownership as many of our growth initiatives and operative improvements have been realised with great success. We wish POLO Motorrad and all its employees a successful future.”

Michael Kern, CEO of POLO Motorrad und Sportswear GmbH, added: “First of all, on behalf of the employees, I want to thank the shareholders of our company as well as all our business partners for the very constructive and successful collaboration. Together we were able to regain the former strength of POLO Motorrad. With our new majority shareholder, we will continue to focus on profitable growth in all distribution channels (stores, online, B2B).”

The transaction is subject to the approval by the relevant antitrust authorities. The parties have agreed not to disclose the purchase price.

About POLO Motorrad

POLO Motorrad is a leading specialty retailer of motorcycle clothing, accessories and technical parts such as motorcycle jackets, pants, helmets, navigation equipment, spare parts and other technical components. The company has a product range of over 40,000 items and operates a nationwide network of eighty-two branches in Germany, seven in Switzerland as well as an extensive website with worldwide shipments.
POLO Motorrad is based in Jüchen, Germany. For further information please visit www.polo-motorrad.com.

About Paragon

Paragon is one of the leading independent private equity firms in Europe with approx. €650 million of equity under management. Paragon works closely with portfolio companies to achieve sustainable growth and operational excellence. The investment portfolio covers various industries and currently comprises 6 companies. Paragon was founded in 2004 and is based in Munich, Germany. For further information please refer to www.paragon.de.