£216m raised by Aston Martin to drive down debt
Aston Martin has raised £216m through a share placing, as it looks to clear high-interest debt that it took out in 2020.
The luxury car manufacturer endured a series of problems after it listed on the London Stock Exchange, with a loss of more than £100m in 2019.
It has since bounced back on its return to profitability, with the firm last week revealing it was likely to exceed its target of £2bn of revenue and £500m adjusted EBITDA by 2045/25 and cut half-year losses to £142m.
Now shareholders including chairman Lawrence Strolls’ investment vehicle Yew Tree, Saudi Arabia’s Public Investment Fund, Geely and Mercedes Benz has agreed to subscribe to £130m of shares, with the rest available to institutional investors.
£4m has been raised through its retail offer and £1.55m has been subscribed through directors.
Aston Martin says the move will help to deleverage its balance sheet and become free cash flow positive from 2024, supported by a significant interest cost reduction.
Last week, it revealed it will invest around £2bn over the next five years, as it looks to secure long-term growth and complete its transition to electrification.
The luxury car manufacturer has earmarked £1.8bn of capital expenditure as well as £200m in tech access fees to partners such as its £182m strategic supply agreement with Lucid Group, to create high performance electric vehicles.
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. I would also like to thank my fellow investors in the Yew Tree Consortium, PIF, Geely and Mercedes-Benz, for their support as we accelerate our vision to be the world’s most desirable ultra-luxury British performance brand.”
