Reuters: Private Equity: UPDATE 1-Accell pedals off with Raleigh bikes

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UPDATE 1-Accell pedals off with Raleigh bikes Apr 26th 2012, 10:52 Thu Apr 26, 2012 6:52am EDT * Deal values Raleigh at 76 mln euros including debt * Raleigh sold 850,000 bikes in 2011, had 200 mln eur revenue * CEO Finden-Crofts to get multi-million stg payout * Diamondback brand is watchword for BMX, mountain bikes By Simon Meads LONDON, April 26 (Reuters) - Dutch bicycle maker Accell Group NV agreed to buy Britain's Raleigh for about 76 million euros ($100 million), adding one of the most famous names in the UK bike industry to a portfolio that includes Dutch, German and French cycling favourites. The deal marks the next step on the road for Raleigh, founded 125 years ago by Frank Bowden on Raleigh Street in Nottingham, eastern England, by marrying its brands with Accell's which include Batavus, Koga and Lapierre. The sale will net Raleigh CEO Alan Finden-Crofts a multi-million pound payout after he led a $20 million management buyout of the bike maker in 2001 from failed parent Derby Cycle. The deal values Raleigh shares at about 60 million euros and the business, including debt, at around 76 million. At its peak, Raleigh was making 1 million bicycles a year from its plants in the Midlands, making such kids' favourites such as the Burner, Grifter and Chopper, with its laid-back seat and long handlebars. But a long-running decline in market share and a quest for savings meant British bike assembly operations folded and manufacturing moved to Asia. Under Finden-Crofts, Raleigh has enjoyed a renaissance, selling some 850,000 bicycles in 2011, reviving sales in Britan and pushing further into international markets. It generated 48 percent of its approximately 200 million euros in revenue in North America, where its Diamondback brand is the watchword for BMX and Mountain bikes. The deal comes after a sale process handled by British mid-market M&A adviser Cavendish Corporate Finance. "As talks progressed with the various interested parties earlier this year, Accell Group emerged as the clear preferred buyer for the business," said Finden-Crofts. The two companies had complementary bike ranges and geographic presences, he said. Raleigh's management team including Finden-Crofts will stay on for at least six months to manage the transition. Accell recorded revenue of 628.5 million euros in 2011, more than a third stemming from its home market, and a net profit of 40.3 million. It said sales in the first months of 2012 had increased both organically and thanks to acquisitions. Accell was advised on the deal by ABN AMRO and Kempen. Link this Share this Digg this Email Reprints

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