Online retailer Wiggle Chain Reaction Cycles was acquired for just £3m plus VAT by Mike Ashley's Frasers Group earlier this year.
The deal, which completed on 22 February, made headlines in March, when it was reported to be worth "less than £10m".
A new report from Wiggle's joint administrators has now revealed the real value, as well as details of a deal with a private equity fund that fell through before Christmas.
In the report, administrators FRP Advisory confirmed that a company, known to be Frasers Group, purchased "certain business intellectual property" for £3m plus VAT, significantly less than the company's previous acquisitions.
In 2011, Wiggle was bought for £180m by private equity firm Bridgepoint. A decade later, Bridgepoint sold the online retailer to Signa Sports United (SSU) in a deal expected at the time to raise $645m (£505m) for its new owner. SSU filed for insolvency in October 2023.
With regards to the Frasers Group deal, the administrators wrote: "An initial payment of £2.625m was paid on completion with an agreed retention to be paid once all necessary transfers of the intellectual property had been concluded. This aspect was successfully concluded and the balance of consideration has been paid in full."
Wiggle entered administration in October 2023, a week after its parent company, SSU, lost €150m (£130m) in financing guarantees. The company appointed FRP Advisory, who sent details of the sale to 58 interested parties.
During the sale process, 24 non-disclosure agreements were signed with interested parties, with seven of them meeting with the management team.
An offer was initially accepted from a "private equity fund who have global operations" on a going concern basis, meaning it was assumed the company was financially stable enough to continue for the foreseeable future.
"Despite considerable due diligence and time invested by management and the Administrators’ staff, the proposed purchaser withdrew their offer on the day completion was due [19 December 2023]," the new report revealed.
The administrators then bolstered Wiggle's stock for the Christmas period, and recommenced the sale of the business in January, reaching out to previously interested parties.
Three potential buyers showed interest; however, in the meantime, the company was no longer considered stable enough to be a going concern. Only one company, Frasers Group, was interested on a "gone concern basis", and a deal for Wiggle's intellectual property was made.
