Today the news broke that Britain’s most globally famous bicycle brand, Raleigh, is in talks to be taken over, in its 125th year in the business.
The Netherlands-based holding company Accell Group is in the frame to buy the Raleigh business. In fact it’s the only potential buyer as it is currently ‘engaged in exclusive discussions’ with Raleigh and its shareholders.
Accell Group comes into negotiations on the back of a growing international portfolio of bicycle brands and distributors.
After selling its stake in German-set Derby Cycle for €17 million in November, the firm has been swift to acquire an electric bike firm based in the US – Currie technologies and titanium bicycle builder Van Nicholas, all done deals before the end of the year.
And before that Accell has been no stranger to acquisitions and sports a vast roll call of names in its portfolio including Koga, Sparta, Winora, Hercules, Hai Bike, Ghost, Lapierre, Atala, and Redline amongst others.
Earlier this year the firm revealed a rise in turnover and net profit for 2011. Turnover grew by nine per cent to 628.5 million (up from €577.2 million in 2010), with the group citing rising sales of electric and ‘sports’ bicycles, particularly in Germany.
The financial statement read: "Positive developments in working capital and a relative reduction of inventories created a strong cash flow. Partly as a result of a positive contribution on balance from one-off items, net profit for 2011 was up by 11 per cent at 40.3 million, compared with 36.4 million in 2010."
Perhaps significantly, turnover for Accell Group has been led by the Netherlands, Germany and France (in that order), the rest largely composed from European countries.
Is this where Raleigh comes in? In 2011 the UK firm sold 850,000 bicycles and sales of over £162m per annum. That would give Accell a far more significant presence in the UK, which remains an attractive market. But beyond that, Raleigh’s globally recognisable brand, forged over 125 years in the trade, must also hold some lure for Accell.
How a buy out would affect Raleigh’s 100+ network of Cyclelife dealers, or indeed any part of the business, is naturally unclear at this early stage. What also remains to be seen is whether Accell has been motivated by a desire for a greater footing in the UK market or lured by the Raleigh brand, or both. Naturally we’ll be keeping a close eye on developments.