Update 4/20:
Kona’s (current) parent company Kent Outdoors put out another press release shortly after this story was published. Hidden inside a lot of words about a “$100 million credit facility from asset-based lender (ABL) Eclipse Business Capital”, Kent Outdoors announced that they would be selling the Kona brand.
“In connection with the investment of capital and the management team coming onboard, the Company performed a strategic review of its operating units and determined that it would continue to seek a buyer for its bike business, Kona. This move 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.”
It’s unclear whether all current employees have been laid off, and if the sale will be for anything more than just the Kona name. Check out the most recent press release in full below.
Original post:
Sea Otter is in full swing and there are a lot of brands in attendance. But it’s the brand that isn’t in attendance that’s generating the most buzz. After appearing on site and setting up their tent, Kona Bicycles then tore down that same tent before the show even started. By the time we rolled into the venue on Wednesday at the end of our ride with Otso Bicycles, the space for Kona’s tent was already vacant (circled above).
The move is a head-scratcher for a number of reasons – the brand had just unveiled a new adventure bike as the show opened, and it seems like a strange move considering they had already paid to get their booth to the venue and set it up. However, the day after their mysterious exit, it was announced that Kona’s parent company, Kent Outdoors, had just appointed a new CFO. According to the press release, new CFO Rob Otto has experience “improving profitability and operational efficiencies along with managing integrations”. Conspicuously absent from the press release is any mention of Kona Bicycles.
We’ve poked around Sea Otter to find more details, but for now, no one is willing to make any sort of comment on the record. BRAIN reported earlier in the week that the company expected to have a “town hall” meeting on Thursday, which seems likely to have taken place, but without any further news. We’ll keep digging, but for now, the future of Kona remains up for interpretation.
PR From Kent Outdoors:
Executive Hire is Part of Company’s Strategic Investment in Leadership, Innovation and Operations
SALT LAKE CITY, April 18, 2024 /PRNewswire/ — Kent Outdoors (“Kent” or the “Company”), which has been helping people in their pursuit of outdoor adventures for more than 60 years, is pleased to announce that it has added Rob Ottoto the company’s executive management team as the company’s chief financial officer. With an exemplary track record in the consumer packaged goods (CPG) space of improving profitability and operational efficiencies along with managing integrations, Otto brings a wealth of experience and expertise to the Kent team and portfolio of brands.
“We are extremely excited to welcome Rob Otto to the Kent team,” said Kent Executive Chairman Lee Belitsky. “He is an experienced leader who will help guide Kent as we actively pursue new opportunities.”
As a results-oriented finance leader, Otto has been recognized for his ability to rapidly interpret complex situations, formulate solutions, and make sound decisions. He possesses considerable experience implementing processes and business solutions that spur growth and improve operations and profitability.
Otto joins Kent after successfully completing the sale of RW Designs, where he served as the company’s chief financial officer and chief operating officer, a wholesale and direct-to-consumer business. Prior, Otto held CFO and COO executive leadership roles at multiple CPG 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.
About Kent Outdoors
Founded in 1959 in New London, Ohio, Kent Outdoors is a diverse platform of outdoor brands with a broad product set spanning personal flotation devices, wakeboards, water skis, towable tubes, snowboards and more. The Company’s portfolio of more than 15 iconic brands comprises industry- leading names such as HO/Hyperlite, Connelly, O’Brien, Liquid Force, Onyx, Aquaglide, Barefoot/Fatsac, BOTE, and Arbor Snowboards (managed by agreement with the Arbor Collective), which have all contributed to the Company’s long-term success in serving a broad base of action sports participants of all ages and skill levels.
Kent Outdoor PR
Financing Follows Earlier Investments from Preeminent Investor Group; Kent to Continue to Invest in Leadership, Innovation, and Operations
SALT LAKE CITY, April 19, 2024 /PRNewswire/ — Kent Outdoors (“Kent” or the “Company”), which has been helping people in their pursuit of outdoor adventures for more than 60 years, today announced a $100 million credit facility from asset-based lender (ABL) Eclipse Business Capital. The new ABL 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.
“We appreciate being trusted to deliver this critical financing on an expedited timeline. It was a pleasure partnering with such a select group – the Company, Arete Capital Partners as well as term lenders including Goldman Sachs and Comvest,” said Marty Battaglia, chief executive officer of Eclipse Business Capital.
With the financial support of its backers, Kent expects to make significant operational improvements, as well as bring in new leadership.
“We appreciate Eclipse’s partnership approach; their organization worked expeditiously throughout and delivered the financing exactly as outlined. The capital investment is instrumental to maintaining solid partnerships with our key vendor partners and customers while allowing Kent the flexibility to also pursue new growth opportunities,” said Kent Executive Chairman Lee Belitsky. “The support also allows the Company to continue to build our market share by attracting new marquee customers and maintaining long-term relationships with key suppliers.”
Belitsky joined Kent as part of the capital investment, bringing significant experience in the sporting goods industry as a key executive who helped drive Dick’s Sporting Goods growth over the past 25 years. Additionally, Kent recently appointed Rob Otto as chief financial officer. Otto joined Kent after successfully completing the sale of RW Designs, where he served as the company’s chief financial officer and chief operating officer, a wholesale and direct-to-consumer business. Prior, Otto held CFO and COO executive leadership roles at multiple CPG companies such as Z Gallerie, Hudson Jeans, Seven For All Mankind, and Affliction Holdings.
“We are encouraged by the commitment to Kent’s brands from its employees and stakeholders,”
said Kent Sowell, vice president of Goldman Sachs. “Coupled with new additions to the Kent executive leadership team, we are excited to support the Company as it focuses on its next phase of growth.”
While Kent’s business operations are evolving with a focus on customer service and consumer satisfaction, its key operating divisions continue to move forward with an eye on the future with new product innovation for the 2024 season. Kent is now in a position to move more aggressively forward in servicing its loyal customers and those entering outdoor sports for the first time with incredible products. Kent’s dedicated employees have spent countless hours helping the Company get to this point.
The Company has retained key leaders of core divisions such as Dave Cook in the Outdoors Division and C.J. Vlahovich in Watersports, both of whom have been with the Company for more than 25 years. Additionally, Zack Eckert, who also has extensive experience in the outdoor industry, has been promoted to general manager of the BOTE brand. Eckert has been with BOTE for more than five years, most recently as vice president of sales, and previously held various leadership positions with West Marine for more than 11 years.
“Kent is synonymous with outdoor sports and the pursuit of outdoor adventure,” said Cook. “Focusing on the Company’s profitable core business lines that provide the greatest promise for long-term growth will help right the ship and navigate the Company into calmer waters.”
In connection with the investment of capital and the management team coming onboard, the Company performed a strategic review of its operating units and determined that it would continue to seek a buyer for its bike business, Kona. This move 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.
“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 Vlahovich. “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.”
About Kent Outdoors
Founded in 1959 in New London, Ohio, Kent Outdoors is a diverse platform of outdoor brands with a broad product set spanning personal flotation devices, wakeboards, water skis, towable tubes, snowboards and more. The Company’s portfolio of more than 15 iconic brands comprises industry- leading names such as BOTE, HO/Hyperlite, Connelly, O’Brien, Liquid Force, Onyx, Aquaglide, Barefoot/Fatsac and Arbor Snowboards (managed by agreement with the Arbor Collective), which have all contributed to the Company’s long-term success in serving a broad base of action sports participants of all ages and skill levels.
About Areté Capital Partners
Areté is an operational improvement and investment firm which provides independent fiduciary and stewardship services to companies experiencing complex organizational change. Areté is proud to serve on Kent’s Board of Directors and currently maintains C-Suite and Strategic Finance roles, having supported the Company throughout this period of growth and leading the Company’s refinancing efforts.
