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Accell Group’s Big Money for Take-Overs

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In the aftermath of yesterday’s announcement by Accell Group NV on the possible take-over of Raleigh Cycle Limited; the financial press reports on the financial capabilities for take-overs of the Dutch bike holding. Accell will need a very significant sum for buying the 125-year old and worldwide renowned brand name and all that goes with it.

Accell Group’s Big Money for Take-Overs

 

HEERENVEEN, The Netherlands – In the aftermath of yesterday’s announcement by Accell Group NV on the possible take-over of Raleigh Cycle Limited; the financial press reports on the financial capabilities for take-overs of the Dutch bike holding. Accell will need a very significant sum for buying the 125-year old and worldwide renowned brand name and all that goes with it.

In the Dutch financial press that quotes Accell Group CEO René Takens, it is said that the holding has up to about 100 million euro to finance take-overs. Takens says in ‘Financiële Dagblad’: “We are busy discussing the possible Raleigh take-over with our banks. All options are open.” Even issuing new shares is a possibility to finance the Raleigh take-over, is said in this newspaper report.

Chapter 11

About ten years ago (October 2001) Raleigh was bought by Alan Finden-Crofts and others for between 74 to 75 million US dollar. At that time the bondholders of Derby Cycle Corporation accepted Finden-Crofts’ MBO bid for the company that filed Chapter 11.

Finden-Crofts bought 42 percent of the controlling shares of the new company named Raleigh Cycle Limited. At that time another 16 percent of the shares were bought by eight former Derby country managers. The other 42 percent (non-voting) shares were bought by investors Perseus Partners, Thayer Capital and Soros Equity Partners.

Leading market share

Perseus Partners is still one of the main shareholders of Raleigh. On the website of this private equity fund management company headquartered in Washington DC it is said that, “Raleigh Cycle holds the leading market share of all bicycles sold in the United Kingdom, Canada, and Ireland, and the third largest market share of all bicycles sold through independent bicycle dealers in the United States.”

In September 2005 Finden-Crofts sold a major part of Raleigh Cycle Limited. The German bike maker Derby Cycle was at that time sold for 40 million US dollar to a Frankfurter private equity firm called Finatem II Beteiligungsgesellschaft. This investor brought Derby Cycle to the stock market and made a huge profit with that. The IPO was set at 12.50 in February 2011. Seven months later Pon Holdings bought all Derby Cycle shares for 28.50 euro.

Calculated guess on take-over sum

How much money will be involved in the Raleigh Cycle Ltd. take-over by Accell is not disclosed. However, taking into account that Raleigh realized sales of about 195 million euro in 2011; a calculated guess will be that it will take up to 60 to 70 million euro.

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