SRAM – Lehman Brothers

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Chicago-based bicycle component maker SRAM and Lehman Brothers Merchant Banking (LBMB) have completed their strategic investment transaction, giving LBMB a 40 percent stake in the company for a reported US$200 million.

„Getting to the finish line, given the current state of the financial markets, is a reflection of LBMB’s role as one of the leading private equity organizations in the middle market and our strong SRAM management team,“ said Stan Day, chief executive of SRAM.

As a result of the transaction, LBMB managing directors Charlie Moore and Bill Lovejoy will join the SRAM Board of Directors. The SRAM management team remains intact.

„All of us at LBMB are thrilled to be closing our investment in SRAM,“ Moore said. „The company is a leader in its industry with tremendous momentum and a bright future. We look forward to working with SRAM’s management team to build the business and realize its full potential in the years to come.“

Prior to the completion of the transaction, seven-time Tour de France winner Lance Armstrong confirmed his return to the sport of bike racing with the SRAM-supported Team Astana. Additionally, Armstrong has made a meaningful passive investment alongside LBMB to further strengthen his ties with SRAM, said to be in the millions of dollars.

Armstrong’s use of SRAM components will become a part of the SRAM overall marketing program. He will also serve as a technical advisor for SRAM’s product development teams alongside many of SRAM’s other established professional riders.

„The entire organization welcomes Lance to the SRAM team,“ Day added. „We are looking forward to his input and doing everything we can to support his return to racing.“

Headquartered in Chicago, with product development and manufacturing facilities in California, Colorado, Indiana, Taiwan, China, Germany and Portugal, SRAM produces a full line of high performance bicycle components for original equipment manufacturers and independent bike dealers. SRAM markets its products under the SRAM, RockShox, Avid, Truvativ, and Zipp brand names. In business since 1987, SRAM expects 2008 revenues to approach US$500 million.

An article from cycling news, dated Oct. 8th, 2008. The Holding filed for chapter 11 on Sept 15th.

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