Derby Cycle Publishes IPO Details
Derby Cycle AG is planning initial listing on the Prime Standard of the Frankfurt Stock Exchange for February 4, 2011. With the successful completion of the transaction, Derby Cycle AGs share capital is expected to increase
CLOPPENBURG, Germany – Derby Cycle AG is planning initial listing on the Prime Standard of the Frankfurt Stock Exchange for February 4, 2011. With the successful completion of the transaction, Derby Cycle AG’s share capital is expected to increase between € 6 million and € 7.5 million. The offer, during which investors have the opportunity to place bids for the shares started on January 24, 2011 and is expected to end on February 2, 2011.
As part of a public offering in Germany and a private placement in other select European countries, a total of 6,840,000 no-par value bearer shares will be offered for subscription. Of these shares, 1,500,000 are from a capital increase against cash contributions, 4,450,000 are from the holdings of the selling existing shareholders, and a further 890,000 are from the holdings of the selling shareholders with respect to a potential over-allotment.
The price range is between € 11.50 and € 15.50. As a result, the total proceeds accruing to the company from the capital increase will be about € 20.3 million if the offer is placed in full (based on the average of the price range).
Derby is owned at 85% by a German private equity company, Finatem. The remainder of the capital is in the hands of Derby’s management. Finatem bought Derby Cycle from the Raleigh group in 2005 for € 31.5 million.
The driving force for Derby’s future expansion will be organic growth, however if opportunities arise the company will also make selective acquisitions. CEO Mathias Seidler believes that going public is the logical continuation of the company’s successful business strategy:
“Our high-quality bicycles and our clear focus on independent bike dealers have allowed us to become Germany’s market leader in terms of revenues. We are profitable and have nearly doubled our revenues over the past five years. Our bikes are already sold in more than 40 countries. We believe that there is still growth potential in many countries, both in Europe as well as in the rest of the world. According to our own information, we are the number 1 in Germany on the new market for e-Bikes with a market share in excess of 20%. What is more, this area is enjoying exceptionally dynamic growth – the IPO can provide us with some additional tailwind to use the opportunities being presented by the market.”
In 2009/10 (as of September 30), the Derby Cycle Group recorded its best fiscal year ever with revenues of EUR 173.2 million. EBIT totalled around EUR 12 million or more than 7% of revenues (EBIT margin). Derby Cycle is optimistic regarding the current fiscal year. At the end of the fiscal year on September 30, 2010 it had received pre-orders that were around 36.1% higher than in the previous year, and once again there was strong demand for e-Bikes.