Chinese vehicle manufacturing giant Geely has acquired a 7.6% stake in Aston Martin, completing a round of funding in which the British firm raised £654 million.
Geely, which owns LEVC, Lotus, Lynk&Co, Polestar, Volvo and half of Smart, was rumoured to be considering a stake in Aston Martin as far back as 2020, before Canadian billionaire Lawrence Stroll's Yew Tree consortium took control at Gaydon.
More recently, Aston Martin revealed that it had rejected a proposed £1.3 billion investment package from Atlas Consortium - a group led by Geely and Investindustrial, the Italian owner of Morgan.
At the time, Atlas's offer was said to have "markedly overestimated the company's new equity capital requirements, would have been heavily dilutive for existing shareholders and comprised a number of execution obstacles".
Now Geely joins other high-profile shareholders in Aston Martin, including Saudi Arabia's Public Investment Fund (PIF), which took a 16.7% share for £78m; Yew Tree, which retains a 19% stake; and Mercedes-Benz, which most recently held a 9.7% stake but invested further in this latest funding round to boost its share back up.
It hasn't been confirmed how much Geely – China's largest private car maker – paid for its 7.6% share in the 109-year-old British sports car maker.
Aston Martin revealed plans for a huge £654m funding round in mid-July, with the aim of lowering its debt (posted at £1.28bn in June) and solidifying its future plans.
Some £335m came from Stroll, Mercedes and the PIF, with the rest to be raised in a subsequent rights issue, which has just been completed.
The firm will use the capital to achieve its long-term objectives of 10,000 wholesales, £2bn of revenue and £500m adjusted EBITDA by 2024/25.
Executive chairman Lawrence Stroll commented: "I'm delighted that we have successfully completed this transformational capital raise, which significantly strengthens our financial position and enhances our pathway to becoming sustainably free cash flow positive.
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Strange for Geely to take a stake in Aston Martin. They could just wait 18 months and buy it out of administration.
This rights issue only buys them more time before failure, and that failure is not dealing with the fact that Marek Reichman designs don't sell.
They're betting the company, again, on Reichman designing desireable cars. Something he's successfully failed to deliver time after time. The updates for the 2023 model line probably won't change that.
Reichman has seen three CEO and two rescue packages. Yet nobody had done what Aston needs to save itself: Sack Reichman.
I completely agree. Marek Reichman needs to go. His designs are in a way interesting and flamboyant, but they don't sell. And the interior design looks so cheap compared to something like Bentley. If someone wants a flashy car there are much better options from Lamborghini, Mclaren etc.
Aston Martin should be about elegance, minimalism and beauty. Not about shouting the loudest (they will always lose that battle).
Aston Martin should have gone down the Porsche 911 route and just kept modernizing the beautiful DB9.