Aston Martin capital raise subscribed after Mercedes deal boosts shares
Aston Martin has said all shares available in its £125m capital raise have been placed or subscribed, as it looks to turnaround its business.
The capital raise, which represents approximately 13.7 per cent of the company’s shares, comprised 250m shares at a price of 50p per share.
Shares in the beleaguered carmaker jumped 6.24 per cent by 9am following confirmation on Tuesday that Mercedes-Benz will take a 20 per cent equity stake in the firm, to become one of its biggest shareholders.
The firm said Permian Investment Partners, Zelon Holdings, Yew Tree Overseas and other institutional investors had subscribed for the raise.
It comes months after Formula One team owner Lawrence Stook took a majority stake in the brand. Stroll labelled the deal, in which Mercedes-Benz will give Aston Martin access to its car design technologies, a “transformational deal”.
Since listing in October 2018 James Bond’s carmaker of choice has struggled, with plunging revenues weighed down further by the coronavirus pandemic.
The new deal will “break the boom and bust cycle that has been a staple of the UK brand”, CMC markets analyst Michael Hewson said.
However it also gives Mercedes a “potential foothold in what is an iconic global brand in a deal, that in the longer term could see the brand subsumed under the Mercedes brand in a manner similar to the way BMW has kept the Mini brand alive.”
Earlier this year Aston Martin said it was planning a complete reset to “enable it to operate as a true luxury company”. Further to the Mercedes-Benz deal, Aston Martin launched a new business plan on Tuesday, under which it will target £2bn in revenue and £500m in Ebitda by 2025.