 Davies contract with Tranmere expired at the close of the 2007–08 season and he attracted the interest of Championship side Derby, with Rams manager Paul Jewell willing to go to a tribunal to secure his services.Davies signed a three-year deal with newly-relegated Derby on 12 June 2008.As the two clubs could not agree a fee for Davies, on 26 August 2008 a tribunal ordered Derby to pay Tranmere up to £725,000 in compensation.