- A new injection of funds will help Aston Martin with its future product plans.
- A recent report suggested that Geely could be interested in taking over the firm.
- Aston Martin’s market valuation has collapsed to less than a tenth of its IPO.
Aston Martin has declared bankruptcy seven times in its history and is in the midst of another financial crunch. However, there’s good news for investors and owners of the brand’s models, as it’s secured £550 million, or $735 million, in new debt financing, just when it seemed things were getting really hard for the firm.
The new financing deal is led by HPS Investment Partners and includes a £450 million ($602 million) secured term loan and a £100 million ($133 million) delayed draw term loan. It has also been granted a £100 million ($133 million) permitted debt incurrence capacity.
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The British firm notes that the £450 million ($602 million) is being used to repay its £170 million ($227 million) super senior revolving credit facility and £20 million ($26 million) that had been drawn through a £50 million ($66 million) facility provided by members of the Yew Tree Consortium, led by Aston Martin’s billionaire co-owner Lawrence Stroll.
“This new £550m debt financing significantly strengthens our liquidity, providing us with both additional resilience and further flexibility to execute our current and future product plans,” Aston Martin chief financial officer Doug Lafferty confirmed.
Aston Martin says it expects to boost year-on-year improved financial performance, boost cash flow generation, and improve its margins. It hopes to do this with an “enhanced product mix from the future portfolio of core and special models.”
Are The Chinese Coming?
News of this latest financing comes just a couple of months after reports indicated that Chinese carmaking giant Geely could be poised to take over. The company already owns Lotus and the London Electric Vehicle Company, and Geely founder and chairman Li Shufu has a well-established affinity for British cars.
Whether or not existing owners and investors of Aston Martin could welcome increased influence of Geely remains to be seen, but the company could take advantage of the Aston’s declining market value, once sitting at approximately £4.3 billion, but now just a tenth of that.
