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Cars Lawrence Stroll to take bigger stake in Aston Martin

20:05  13 march  2020
20:05  13 march  2020 Source:   autocar.co.uk

Aston Martin in F1: Stroll talks for the first time about the new factory team

 Aston Martin in F1: Stroll talks for the first time about the new factory team © LAT Lawrence Stroll talks about his plans with Aston Martin Since January, Lawrence Stroll, the owner of the Formula 1 team Racing Point, has been a partner of Aston Martin. He will soon also act as the company's chairman. For him, the Formula 1 commitment, through which the team is to receive factory team status in the 2021 season, marks the "heart" of the marketing plans for Aston Martin. There should also be a technology transfer.

a man standing in front of a car: Lawrence Stroll and Aston design boss Marek Reichmann unveil the V12 Speedster © Autocar Lawrence Stroll and Aston design boss Marek Reichmann unveil the V12 Speedster

The investment fund headed by billionaire Lawrence Stroll has reworked its planned investment in Aston Martin – taking a bigger slice of the company as a result.

While other car firms also suffered, the British company’s share price has been especially badly hit by market uncertainty sparked by the coronavirus pandemic. At one point earlier this week shares were listed at under £2 each.

In January, Stroll’s investment fund had agreed to take a 16.7% stake in Aston Martin for £182 million, at a price of £4 per share. The deal, first reported by Autocar, also included a £318 million cash infusion through a new rights issue, for a total of £500 million.

Official: Racing Point becomes Aston Martin factory team in 2021

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Given Aston’s dramatically reduced share price, Stroll and his fellow investors have radically reworked the agreement. The revised deal will be worth a total capital raise of £536 million, with Stroll’s investment fund, named Yew Tree, taking a larger 25% stake in the company at a value of £2.25 per share. Yew Tree will also provide £75.5 million in “short-term working capital support” to ensure Aston has the liquidity it needs to meet the revised investment timetable. That is an increase in £20 million from original plans.

The annual general meeting scheduled for 16 March has been postponed, with voting to approve the new deal to be conducted by proxy.

Stroll said: “There has been a significant change in the global market environment in which Aston Martin Lagonda operates. What has not changed is our commitment to provide the Company with the necessary funding it needs to manage through this period, to reset the business and to deliver on its long-term potential.

Racing Point maintains driver pairing Perez / Stroll

 Racing Point maintains driver pairing Perez / Stroll © LAT Lance Stroll and Sergio Perez should drive at Aston Martin in 2021 Racing Point will continue to rely on the services of its two drivers Sergio Perez and Lance Stroll as Aston Martin's team. "We have a really good pairing of drivers," team boss Otmar Szafnauer emphasized to 'Motorsport-Total.com' and announces that in 2021 these two drivers will also compete.

“Following recent moves in the share price and discussions with the Board, I and my consortium of investors, have agreed that we will now acquire 25% of the company and take up our rights in full in return for a long-term capital Investment of £262 million.  In addition, we have agreed to advance a further £20 million in short term funding to support the company, bringing this total amount to £75.5 million.  Whilst the immediate outlook looks increasingly challenging, I remain fully committed to the future of Aston Martin Lagonda and look forward to implementing our plans once the fundraising is complete."

While announcing the deal, Aston Martin Lagonda said that it was “proactively” managing its supply chain and business during the spread of the Covid-19 virus. It says it has put public health measures in place to protect its staff.

The firm also said that despite some parts supply disruption from China “there has been no impact on production to date”, with supply secured “until at least early April”.

Aston Martin posts £104.3 million pre-tax loss in 2019

  Aston Martin posts £104.3 million pre-tax loss in 2019 British manufacturer says recent investment and turnaround plan can still help achieve long-term profitWhile the British firm’s retail sales rose 12% in 2019, wholesale volume – sales of cars to dealers – dipped by 9%. In total, it sold 5862 cars to dealers, compared with 6441 in 2018. Higher selling costs and lower profit margins on each car also hit the firm, leading to revenue declining by 9%, to £997 million. The firm also sold fewer specials.

Aston did note that Covid-19 has impacted customer demand in China and Asia, adding it “has the potential to do the same in other markets.”

Aston boss Andy Palmer said: “We are actively managing the potential impacts of Covid-19 on a daily basis, most particularly in our tier 2 supply chain, with no disruption to production to date and are mindful of the ongoing uncertainties and risks to the business.

“The first two months of the year were planned to be our smallest in wholesale unit terms, as we start to rebalance supply and demand; a key component of our plan to turn around performance and restore our price positioning. Trading has generally been in line with these conservative expectations, with retail performance slightly better than planned.”

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