Vancouver-based retailer Mountain Equipment Company has reached a deal to be acquired by textile executive Tim Gu.Supplied
Mountain Equipment Company has reached a deal to be acquired by textile executive Tim Gu, after months of seeking a buyer to revive the outdoor retailer.
The announcement on Friday confirms reporting by The Globe and Mail last month about the deal. The Vancouver-based retailer will now be majority owned by Mr. Gu, a manufacturing executive with textile factories operating in both Canada and overseas. Other investors include current MEC chief executive Peter Hlynsky and chief merchandising officer Chris Speyer. Terms of the deal were not disclosed.
Mr. Gu is also an investor in Canadian apparel brands Roots and Tilley. He is the founder of E.Star International Inc., which has factories in Canada and overseas that produce apparel and hosiery. The company’s website lists Canada Goose, Canadian Tire Corp. Ltd. and Walmart among its clients. Mr. Gu is also chairman of Mississauga, Ont.-based Unisync Group Ltd., which produces uniforms and apparel for clients in the public and private sector.
Talks between MEC and its new owner began months ago, Mr. Hlynsky said in an interview on Friday, but the retail team also got to know Mr. Gu through a number of apparel design and development projects that have been in the works since late last year.
“He understands the manufacturing side of things probably better than a lot of people we talked with,” Mr. Hlynsky said. “He’s such a presence in the Canadian market. You think about all the brands he produces – that stood out for us.”
MEC has a private-label business that makes up a significant portion of its sales, selling apparel such as snowsuits and activewear, as well as outdoor gear. Under its new ownership, the company plans to shift some of its manufacturing – particularly in MEC-brand clothing – back to Canada, Mr. Hlynsky said. New products that were developed and made domestically will be coming to stores starting this summer, he added.
More retailers have been reviewing their supply chains amid the tariff fight with the United States that has upended supply chains. Very few of MEC’s products are sourced from the U.S. and affected by tariffs, but Mr. Hlynsky said the climate that has resulted – with Canadian consumers seeking to support more domestic brands – is an opportunity for MEC.
“There is a desire to have product that is made in Canada,” he said, adding that MEC will also continue many of its offshore supplier relationships that it has developed over the years.
“As a lifelong believer in Canadian manufacturing and innovation, I’m proud to join MEC’s journey,” Mr. Gu wrote in a press release on Friday. “Together, we’ll strengthen its foundation, expand its reach, and ensure that MEC remains an essential part of Canada’s outdoor culture for generations to come.”
MEC filed for court protection from its creditors during the pandemic, and was acquired in late 2020 by California-based investment firm Kingswood Capital Management LP for $150-million. That deal ended the retailer’s 49 years as a co-operative. In the current deal, Kingswood will retain a minority interest in MEC as a limited partner.
The Globe first reported in January that MEC was up for sale again, and had fallen behind on payments to its vendors, signalling financial troubles at the outdoor retailer.
“Kingswood is pleased with the investments we’ve made in the business over the past four years and the resulting growth in MEC’s brand offerings and private label,” Alex Wolf, managing partner of Kingswood Capital Management, wrote in a release. “Turning it over to Tim and his team makes sense at this juncture and positions MEC to grow its presence across Canada.”
After seeing sales decline significantly in the first year of the pandemic, MEC’s business rebounded in 2021 as executives worked to improve operations and shed unwanted products from its stores. But in more recent years, it began to struggle again.
In a confidential presentation provided last summer to potential bidders for the chain, which was obtained by The Globe, MEC disclosed that its sales had been falling since 2023.
More recently, Mr. Hlynsky said that sales have been growing again, a trend that began last year and has continued through 2025. As tensions with the U.S. cause many Canadians to revise their travel plans, Mr. Hlynsky believes MEC is seeing a boost from consumers looking for advice on outdoor activities at home.
MEC currently has 26 stores across Canada, and sees opportunities for further growth. The company plans to continue to open new stores at a “moderate pace,” Mr. Hlynsky said.