DAR looking to sell up to 20 per cent of British marque

Aston Martin owner DAR is to sell part of the iconic British marque. It is also seeking to borrow up to $1bn to refinance its debt.

The investment group has said it is considering offers for 10-20 per cent of the Aston brand. It bought half of Aston Martin in 2007. The company was previously owned by Ford.

"We are not considering selling and exiting," said DAR vice-president Amr Abou El-Seoud. He said that a "maximum 10 to 20 percent of the company" might be taken out of all investors. "There is a 60 to 70 percent chance that we will reach a deal soon."

Mercedes has been suggested as a potential stakeholder. There is already a link between the companies - the Kuwaiti Investment Authority owns a seven per cent stake in Daimler.

Back in February Adham Charonoglu, of DAR, said that Mercedes might collaborate with Aston on range of ventures, from engine development to entirely new models.

The seeds of this are in place. Mercedes is already planning to work with Aston on the next Maybach, as the company's small size allows for greater flexibility, lower bureaucracy and, hopefully, swifter development. This and Aston's new luxury saloon could both be based on the forthcoming W222 S-class platform.

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12

15 December 2008

The end of Aston Martin as we know it.. Prepare for the Vantage SLR.

15 December 2008

If the car industry was a television programme we would say it was too unrealistic to be believed. Why would anyone want to buy a stake in a luxury car firm in this current climate? The fact that they are selling some of their percentage so soon after acquiring it should set alarm bells ringing.

15 December 2008

None of this makes sense. Perhaps that's the point. Financial games and press releases to obscure the fact that this DAR thing is short of readies and needs to raise cash pronto.

Why would Daimler buy into Aston Martin? The last thing they need is another millstone. They've just bought into Russia's largest truckmaker, but that's a strategic investment for the future. This DAR/Kuwaiti thing makes no sense either. Why would DAR expect Daimler, at Kuwaiti investment prompting, to buy their Aston Martin stake? Surely that would be the Kuwaiti high-rollers passing money amongst themselves, through Kuwait's stake in Daimler. The whole thing stinks. If I was Daimler I'd say get stuffed, sort out your own lack of readies. I suppose the Kuwaitis could threaten Daimler by putting up their stake for open sale and thereby crashing Daimler's share price further and perhaps triggering a hostile takeover bid.

Daimler should pursue its own path. It doesn't need the facilities of AM at Gaydon for Maybach/S Class development. It has AMG too, for high-end engine and chassis development. Will be interesting to see how this pans out in next few weeks. My guess is AM bankruptcy, as of old in its past. To be shortly followed by some stupid bailout by HM Govt. If it's good for JLR, they can hardly refuse Gaydon and its workers. Of course this way lies utter ruination of Govt. finances and currency. Life is about choices, Boutique car producers are not core to survival of an economy and nation. Especially a producer that does not produce the core, the engine and powertrain.

15 December 2008

Yup sounds like Aston is in trouble - the last bastion of British innovation and exclusivity.

Does not bode well for the Rapide.

Anonymous

15 December 2008

Some good points. But Daimler insiders have already admitted that Aston can design and engineer a Maybach replacement more cheaply and quickly than it can do internally. A few thousand Astons per year running AMG engines helps offset the development and manufacturing costs too (as does Aston potentially using the SLC supercar platform). Even the mighty M-B needs to share powertrain R and D costs which is why it's also sharing tech with BMW etc for hybrids and other large capacity engines.

15 December 2008

[quote Quattro369]

If the car industry was a television programme we would say it was too unrealistic to be believed. Why would anyone want to buy a stake in a luxury car firm in this current climate? The fact that they are selling some of their percentage so soon after acquiring it should set alarm bells ringing.

[/quote]

One the other hand, this could be exactly the right time for a buyer - with spare cash - to buy a stake in Aston at a very attractive knock down price.

As the old saying goes, periods of economic down turn/recession etc are the best time to buy, if you have the money. Remember, recessions don't last forever. But yeah, no doubt AM is struggling.

15 December 2008

I am of the view that the possibility of Daimler (Mercedes Benz) acquiring Aston Martin is high if the transaction is structured correctly.

There is no way Daimler is willing to dip into their cash reserves to acquire part of, or all of Aston Martin from its current owners (DAR, The Kuwaiti Investment Board, David Richards, etc.). The current owners paid a startospheric price for Aston Martin a couple of years ago at the height of the financial boom. There is no way Daimler is willing to pay anything near the price they paid. Daimler itself is operating under severe financial stress like the rest of the car industry at the moment. Furthermore, Daimler is rumoured to be under speculative attack from hedge funds and/or private equity firms like what happened to Continental AG or Porsche's creeping bid for VW via a series of derivative swap transactions (though the possbility of this has subsided in recent months).

If Daimler is to acquire Aston Martin at the behest of DAR and the Kuwaiti Investment Board. The only viable way to do so is to structure the bid for Aston Martin in the form of share-based bid. It is convenient that Daimler and Aston Martin have the same large institutional shareholders in the form of DAR and the Kuwaiti Investment Board. Daimler could pay them for Aston Martin by issuing new Daimler shares or utilising the treasury shares it has on its balance sheet. This way, both DAR and the Kuwaiti Investment Board could get Aston Martin off their hands and swap their illquid shareholdings in a private company (Aston Martin) for that of the shares of a larger, relatively stronger, and lpublicly traded company (Daimler).

Daimler has other incentives to do such a deal because they can get their hands onto a luxury car marque for a much lower price than what DAR and the Kuwaiti Investment Board paid for it 24 months ago. Daimler can acquire Aston Martin without depleting its cash reserves. Furthermore, Daimler can also bolster its precarious position from specualtive attacks by issuing more shares to two friendly shareholders (DAR and the Kuwaiti Investment Board).

Everyone can come out happy! Including Dr Bez!

ZM

15 December 2008

I'm sorry, but I fail to see how Aston Martin could develop a better Maybach than Mercedes??

Surely it would make more sense for Mercedes to sell the SL series floorpan to Aston as a basis for the next generation of Aston Martin products?

15 December 2008

Ok Autocar, so when you publish the sensationalist headline "Aston Martin for Sale", what that really means is 20 percent, at the most, is up for sale.

Apart from the over the top headline, it is quite sad to see that Mercedes might well be in the running. Fine cars as they are, I do not think they understand a brand like Aston, and look at the maybach, do Aston really want any association with that?!

16 December 2008

Something is up, there are rumours about Prodrive/Subaru as well. And they are all linked...

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