Pon Holdings, a large-scale Dutch importer of cars and industrial machinery, among others, has reached an in-principle agreement with Gilde Buy Out Partners, the majority shareholder of Koninklijke Gazelle, to take over the leading brand in the Dutch bicycle market.
Gazelle assembles an estimated 300,000 bicycles per year at its factory in Dieren, with about 500 employees and parts imported from Asia. However, it has been under pressure and reportedly suffered losses in the last two years, which encouraged its bankers to push for a sale.
The deal fits in with the strategy of Pon, a family-owned company, to seek growth in the mobility market. It was particularly attracted by opportunities in the market for electric bicycles, which has been growing rapidly in the Netherlands. Gazelle is the second-largest Dutch supplier of e-bikes, which make up about one-third of its turnover.
Based in Nijkerk, Pon is an international group with 11,000 employees, a turnover of about €5 billion and a net profit that almost doubled to €178.5 million in 2010. It operates in a dozen countries and is an agent for Volkswagen, Audi and Caterpillar, among others.
Pon has already been involved in the bicycle market, starting as a bicycle dealership in Amersfoort at the end of the 19th century and even making its own bicycles under the Pon brand name. For several decades, Pon imported several bike-related products, such as Continental bicycle tires.
Jeroen Walraven, chief executive of Gazelle, said the tie-up should enable Gazelle to explore its full potential in the Netherlands as well as new markets. Gazelle will be managed independently and Pon has no intention of altering its identity. The takeover is not expected to have any adverse effects on employment.
The intended transaction has been submitted to the employees' committee and trade unions of Gazelle for their advice, and to the authorized competition authorities for approval. Both parties declined to provide any further details on the transaction.
