Gazelle Owner Pon Named as Buyer of Derby Cycle

CLOPPENBURG, Germany - This morning, Derby Cycle AG announced that negotiations regarding a business combination agreement with a strategic partner have reached an advanced stage.

Accell Group is specifically excluded in the announcement as a potential takeover candidate because Derby Cycle stated that “current shareholders of Derby Cycle AG are no potential partners.”

Derby Cycle’s listing at the Frankfurt stock exchange rose sharply since the statement this morning on the business combination. This is partly due to the fact that the Financial Times Deutschland reported about an upcoming takeover bid by the new owner of bicycle manufacturer Gazelle, the Dutch company Pon Holding. According to the Financial Times Deutschland Pon is preparing this bid and is assisted by a law firm and investment bank Lazard. The newspaper cites sources who are closely involved in discussions.

Last week, Derby Cycle reported that the dealer orders for the coming season are 25% higher compared to last season. “Mainly the German dealers have been eager to order model year 2012 bikes, driven by upbeat sales in the first eight months of this year and positive reports on electric bikes”, reported Derby Cycle.

The results of the negotiations still have to be approved by the Board of Derby Cycle AG.

“No interest from Accell Group”

In late August it was announced that Accell Group expanded its share in Derby Cycle AG to 22%. At that time it looked as if Accell Group intended to takeover its German competitor. Financial analists called it the next step in the consolidation of the European bicycle industry. Matthias Seidler CEO of Derby Cycle was not happy and responded very negatively and called Accell Group’s action “hostile”. Seidler then suggested that “they had not received a related declaration of intent, and there had been no discussions with representatives of the Accell Group about this topic. From today’s perspective, we have no interest in of any kind of cooperation with the Accell Group, however it might be structured, and of whatever type it might be.”

Accell Group also denied that the enlargement of the stake in rival Derby Cycle was mentioned to take over the German rival. “There are no talks with Derby Cycle and a takeover is not an issue,” said Accell Group’s Chief Financial Officer Hielke Sybesma last September 1 to Dow Jones Newswires.