Aston Martin raises £216m to clear debts and bolster EV transition
Aston Martin said it had successfully raised £216.1m through a share placing scheme this morning, in order to pay down debts that have held back the business over the last few years and bolster its electrification strategy.
The luxury marque said that just over 58 million shares had been distributed, raising proceeds of £216.1m at a price of 371p per share – a discount of 6.2 per cent on yesterdays’ closing price of 395p.
Shares tumbled 6 per cent in early trading on the announcement.
Aston Martin’s consortium of shareholders include Yew Tree, owned by its chairman Lawrence Stroll, Saudi Arabia’s Public Investment Fund and the Chinese automaker Geely.
It said the new capital would “further deleverage its balance sheet,” and accelerate its goal of evening out its debt to earnings ratio, while supporting future investments in the company’s major push to electrify its fleet.
Lawrence Stroll, executive chairman of Aston Martin, said: “This successful share placing builds on the actions we have taken to create shareholder value. Supported by the company’s improved financial position, the placing will allow us to meaningfully deleverage the balance sheet and accelerate our journey to become sustainably free cash flow positive.
“The tremendous backing from our largest shareholders along with the strong appetite from institutional and retail investors also demonstrates the continued confidence in Aston Martin and our future direction.”
The ultra-luxury automaker has long been eyeing a move into the green and last week reported a £142 million pre-tax loss in its half year results, while noting a nearly £1bn debt pile.
A significant part of the marque’s strategy has involved heavy investment in an electrification push to up its production of ultra-luxury EVs. It currently plans to inject £2bn over the next five years with the goal of producing its first EV by 2025.
Last month, Aston Martin announced a £182m partnership with US EV manufacturing start-up Lucid, which saw shares soar.
This had followed Hangzhou-based automaker Geely – one of its largest shareholders – upping its stake in the firm by 17 per cent and investing £234m, in what amounted to a significant boost for the marque’s EV strategy.