Information on the Target

Profinpar has acquired a majority stake in The Barracuda Company, which operates two specialized electric bicycle brands, Barracuda and MyCityBike.be. The Belgian fund, backed by 45 entrepreneur investors aimed at fostering the growth of SMEs and family-owned businesses, does not disclose the investment amounts. However, it is known to invest between 1 to 6 million euros per stake. In the case of The Barracuda Company, Profinpar acquired 70% of the equity while allowing founder and CEO Frédéric Verbeeck to maintain control of the company. Two entrepreneurs from the fund, both experts in the retail sector, have been appointed to support the company moving forward: Denis Knoops, former CEO of Delhaize, and Thierry Quertinmont (GIB, Trafic).

Currently, The Barracuda Company stands as the only retailer in Wallonia and Brussels exclusively dedicated to electric bicycles, operating five stores and an online platform. In Flanders, where it does not yet have a presence, there are minimal competitors with a similar positioning. Frédéric Verbeeck emphasizes their aim to become the leading brand in Belgium, having plans to open a sixth store in Zemst within two months, strategically placed between Brussels and Mechelen.

Industry Overview in Belgium

Belgium has witnessed significant growth in the electric bicycle sector, especially as environmental concerns and urban mobility challenges escalate. The demand for eco-friendly transportation alternatives has reached new heights, with both government initiatives and societal trends pushing for sustainable solutions. The electric bicycle market is part of a burgeoning green economy that appeals not only to environmentalists but also to the broader public seeking more efficient commuting options.

In the past few years, Belgium, particularly in urban areas, has seen a surge in transportation modes that prioritize sustainability. Key cities have begun integrating cycling infrastructures, such as dedicated lanes and bike-sharing systems, facilitating a favorable environment for electric bicycle growth. The government's incentives for electric vehicles, which include bicycles, further bolster market prospects.

Although the pandemic posed challenges across various industries, it has inadvertently heightened the interest in cycling as a safe mode of transportation. With the rise in remote work, many individuals are seeking alternatives to public transport, leading to increased adoption rates of electric bicycles. Experts estimate the market will grow by 15% to 30% annually, reflecting a robust and promising outlook.

The Rationale Behind the Deal

The rationale underpinning Profinpar's investment in The Barracuda Company lies in the growing demand for electric bicycles as a sustainable transportation option. The strategic positioning of Barracuda as a leading electric bicycle retailer in Wallonia, paired with its ambitious expansion plans into Flanders and potential international markets, makes it a compelling investment. The hybrid distribution model, dubbed “Phygital” by Frédéric Verbeeck, combines physical retail with online convenience, catering particularly to clients over 65 who may require additional support in their purchasing journey.

This innovative approach not only meets existing market demands but also positions The Barracuda Company as a first-mover in adopting a flexible model enhancing customer engagement and satisfaction.

Information About the Investor

Profinpar operates as a fund dedicated to fostering the growth of small and medium enterprises and family-owned businesses within Belgium. Comprised of 45 entrepreneur investors, Profinpar aims to target promising ventures within the local market. It typically engages in either minority or majority stakes, allowing for agility in investment strategies and support tailored to the specific needs of each business.

Led by partners experienced in various sectors, including retail, Profinpar brings expert insights and strategic guidance to its portfolio companies. The firm values not only financial returns but also the socio-economic impact of its investments, focusing on businesses that contribute positively to the community and promote sustainable growth.

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Investing in The Barracuda Company appears to be a sound decision, given the robust market environment for electric bicycles and the company's current leadership position in Wallonia. The strategically integrated Phygital model addresses the unique needs of the aging population while simultaneously tapping into the rising trend of online shopping. This could result in elevated customer acquisition and retention rates, a crucial aspect for long-term profitability.

Moreover, the anticipated growth in the electric bicycle market aligns well with Profinpar's investment philosophy, emphasizing sustainable development. As global consumer behavior increasingly shifts towards eco-friendly preferences, The Barracuda Company's growth trajectory seems promising. Challenges such as supply chain disruptions may temporarily hinder operations, yet the overall market outlook remains optimistic.

The collaboration with retail experts from the Profinpar fund also provides The Barracuda Company with substantial operational insights, enabling faster execution of strategic initiatives. This partnership could enhance competitive advantage as the company strives to expand into new regions, including Flanders and potentially France.

In summary, the investment in The Barracuda Company not only demonstrates Profinpar's commitment to sustainable business practices but also positions the company for substantial long-term growth in a lucrative market segment.

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