Former Scott Sports CEO Beat Zagg says he continues to lead the company despite being fired.

Bit Zaugg, who has been the CEO of Scott Sports since 1998, stated that he still remains the head of the American company that produces bicycles, winter equipment, and sportswear, despite the decision of its parent company to fire him. The dismissal has led to a strange power struggle, raising doubts for Zaugg about the qualifications of his successor, Kim Juwon, in leading the brand in the European bicycle market. The immediate termination of Zaugg's position as CEO was announced last week with the full support of the Korean company Youngone, which acquired Scott Sports in 2015 after purchasing 50.1% of its shares. Since then, it has financed much of its growth in the international market.

It was also announced that Kim Joo-won, who has over 17 years of experience in investment banking and was the head of growth strategy and mergers and acquisitions at Youngone, as well as a board member of Scott, will become the new CEO. He will be advised by two experienced specialists from Germany and the USA, who have many years of experience working with companies like Specialized, Accell Group (owners of Raleigh), and Focus & Kalkhoff Holding. The company stated that the decision was made to "refresh the development of Scott to become a leading manufacturer of bicycles and other categories of sports goods."

The press release from Scott Sports announcing changes in leadership states: "The Scott Board of Directors emphasizes that the long-term commitment of the main shareholder, Youngone, remains central and unquestionable." However, what seemed like a routine leadership change in the organization after difficult times in the cycling industry has come under threat following shocking statements from disgruntled Bit Zaug, who owns the second-largest stake in the company. "This announcement was made to destabilize the company and its employees," Zaug told Bicycle Retailer News on Monday. He claims that the announcement was made through a PR agency working for Scott's main shareholder, the Korean company Youngone, rather than for Scott Sports, and that the dispute is caused by a "clash of cultures" between Youngone and the company's employees. "I am still standing in this power struggle," Zaug said. "Youngone's financial support is based on the fact that, as is known, consumer goods inventories are usually limited. It doesn't matter whether industry consultants will support the announced interim successor, Juwon Kim, or not - Kim himself would have no idea about the European cycling and sports tourism market." He added that, like many major cycling brands, Scott is facing challenges in the current environment.

In December of last year, Youngone, a supplier for brands like Patagonia, Adidas, Lululemon, Outdoor Research, and The North Face, with factories in Korea, Bangladesh, China, Vietnam, and Thailand, announced a loan of 150 million Swiss francs (131 million pounds) to Scott Sports to ensure additional liquidity. However, according to Zaugg, the need for the loan arose because Youngone "destroyed our banking relationships." He said, "(Youngone) prefers that we are on their infusion... Although we had other ways of financing, they did not allow that to happen. They always say, 'We were so helpful.'" Zaugg acknowledged that Youngone controls the majority in the set, but said that they did not fire him correctly. "So far, they have done it wrong," he said, though without much clarification. "This should remain my secret for now." He also concluded that Youngone's announcement will "strain the collaboration between the well-established Scott team and European independent bike dealers." "The fact that they learned about the decision of the Korean parent company from the press also does not contribute to the values of Scott and our European views on management," he said. "I regret the announcement made by Youngone without prior notice. The Scott team would prefer that the majority owners of Youngone continue to trust them in the current situation and allow them to leverage their years of experience and established relationships with IBD."

It has been reported that Zaugg intends to contact the Scott board during this week. Last year, Scott Sports found itself at the center of another strange battle when the family of legendary AC/DC frontman Bon Scott attempted to trademark his name for selling goods, including a clothing line, sunglasses, and bags. However, Scott Sports contested the application, arguing that the trademark "Scott" is too similar to their own and could cause "confusion among consumers" between their line of bicycles and wallets and the name of the legendary rock musician.