Correction: Merida Buys 49% of Specialized

TAIPEI, Taiwan (August 8) - Merida Industry Co. stated today that it has acquired 49% of Specialized Bicycles Inc., the US company that was first in taking the mountainbike to production. Bike Europe mistakenly reported earlier on this website that Taiwan’s number two bike maker bought only 19% of Specialized. Merida Industry spokesman Cash Yang confirmed the 49% stake of Merida in the US bicycle company today.
This marriage of one of the world's top brands with one of the world's top manufacturers will create synergy at all levels of business, from R&D to finance to sales and distribution, said Cash Yang. In a prepared statement, Specialized emphasized that its founder and president, Mike Sinyard, would remain firmly at the Specialized helm after the deal, as Merida was only a minority shareholder. For it's 49% stake in Specialized, Merida paid around US$30 million in cash. Sinyard also devoted an undisclosed amount of personal funds to bolster his company. When asked whether Specialized was strapped for funds, however, Merida officials offered no comment. Practically, the arrangement should bring short term benefits to both companies. Merida will gain near immediate exclusivity for Specialized's orders to Taiwan, as Specialized will no longer use competitors Giant and Ideal. Specialized, meanwhile, receives a quick cash influx to support its current marketing, sales and merchandising programs. Over the long term, Yang said that Merida hopes to win out through a close working allegiance with one of the world's top brands. In the past, Merida has experienced some difficulty in establishing its own international brand, despite years and millions of dollars spent in the effort. Specialized announced several far reaching goals for the new cooperation. The first is the continued support of the independent bicycle dealer, a goal in accord with Specialized's focus on products for cycling enthusiasts. Another goal was future expansion and investment in Europe.(DF)