Empower and Uneeda Industries to Invest €2 M in Bicycle Frames Factory

Empower and Uneeda Industries to Invest €2 M in Bicycle Frames Factory

The development of a high-tech bicycle frame factory in Sofia is scheduled to begin soon, as reported by Capital.bg. Тhe project is backed by Empower Capital, a private equity fund for growing companies, and Uneeda Industries, a company of Georgi Stoimenov, who owns a share in Bulgarian mountain bikes RAM and several machine-building companies like PodemCrane but is better known as manager of the tennis player Grigor Dimitrov. Minority shareholders are Anton Nastev and Alexander Davidkov, who are well-known names in the bicycle industry in Bulgaria and will act as company’s directors of operations. The investors would provide a little over €2 M and will count on a bank loan for the remainder.

The idea behind the factory is to solve a major problem in the sector – the Asian monopoly on bicycle frames. Over 90% of frames globally are manufactured in China, Taiwan or the Philippines, with only one company operating in Europe. As a result, the industry is hampered by long delivery times, which often exceed 6 months – yet only 40% of orders arrive on time. This forces companies to place orders once a year, making business planning difficult. The ambitions of the founding team for the Sofia factory are to execute orders in 12 weeks, to offer smaller batches and even the production of samples – something that currently is not possible. The factory would save considerable costs for manufacturers and would help create know-how that could strengthen the image of Bulgaria as a top 5 producer of bicycles in Europe with annual output of ca. 1 million units.

The factory will be located near Sofia. Its maximum capacity is planned at 200,000 aluminum frames per year, incl. frames for electric bikes. The plant should employ 113 people, mostly machine engineers. Automated production lines would allow for process optimization, speed and quality of output. The team plans to rely on Bulgarian aluminum producers and suppliers for raw materials. Opening is planned for Q1 2019. According to their 5-year business forecast, investors expect to reach break-even in the second year of operation and investment payback by the fourth year.

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