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Derby Cycle CFO eyes growth over dividend near-term

Published 01/24/2011, 10:47 AM

* Derby Cycle won't pay dividend for near-term - CFO

* Derby to focus on growth in U.S, Australia, Europe - CFO

* Selective acquisitions possible - CFO

* Germany's biggest bike maker to begin trading Feb. 4

By Michelle Martin

FRANKFURT, Jan 24 (Reuters) - German bourse debutant Derby Cycle plans to forego paying a dividend in the near-term, preferring instead to invest in growth in Australia, the United States and Europe, the group's CFO said on Monday.

Derby Cycle, which is Germany's biggest bicycle maker, is due to list on the Frankfurt Stock Exchange on Feb. 4.

"We need the proceeds from the capital increase to grow and it would be counterproductive to start thinking about a dividend in the first year," Derby's Chief Financial Officer Uwe Boegershausen told a news conference.

"In two to three years that may change -- by that time we'll be focusing more on the interests of our shareholders," he added.

Derby hopes to raise up to 100 million euros ($135.6 million) by listing in Frankfurt and plans to use the funds to further penetrate the foreign markets -- especially Europe, the United States and Australia -- and develop its electric bikes.

Chief Executive Matthias Seidler said: "We want to invest in innovation and we want to use this innovation to differentiate our products."

Derby is offering 6.84 million shares at 11.50 to 15.50 euros, 1.5 million of these stemming from a recent capital increase.

In the financial year 2009/2010 Derby sold 430,000 bicycles, of which more than 10 percent were electric bikes, and generated 173 million euros in revenue. It has seen sales almost double in the last five years and says it is the market leader for electric bikes, with a more than 20 percent market share.

Boegershausen said the company was focusing on organic growth, although it may mull targeted takeovers.

"Until now, our growth has been entirely organic but we are now of such a size that we can certainly consider selective acquisitions," he said.

Derby is set become the first German company to list this year, boosting expectations for a wave of initial public offerings after a near-two-year drought. ($1=.7376 Euro) (Editing by Jon Loades-Carter)

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