Derby Pays Debts After Gazelle Sale

WASHINGTON, USA (July 24) - According to the US Securities and Exchange Commission (SEC), the Derby Cycle Corporation has paid its debtors after the sale of Gazelle in the Netherlands. The Gazelle sale was officially completed last Thursday, July 19. Derby has sold its Dutch moneymaker to Gazelle Holding BV which is owned by a financial group named Gilde Investment Management, part of the Dutch Rabobank controlling insurance's and pension funds. Derby has received Euro 142.5 million (US$ 121.9 mn) in cash for Gazelle. According to the SEC, "A portion of the net proceeds from the Gazelle sale was applied first to repay or collateralize all the outstanding amounts under the Company's DEM 209.4 million (US$93.9 mn) senior secured revolving credit facility. As a result of the repayment, the Revolving Credit Facility was terminated." After making these payments, the question remains how the Derby Cycle Corporation will meet its interest payments on its $100 million principal amount of 10.0% senior notes and its DEM110 million principal amount of 9.38% senior notes. And with that question unanswered, the interest payments are still the millstone hanging on the necks of the remaining Derby companies like Raleigh and Derby Germany. This means that the refinancing of the remaining Derby companies still has to be effectuated. With that unsolved, the Management Buyout (MBO) bid which was put forward by Derby CEO Alan Finden-Crofts on June 6 at Derby owners Thayer Capital Partners and Perseus Capital, is still an option. More news about the MBO bid is expected within weeks. (JO)