Daimler bags lux joyride on Aston Martin’s dime
For Aston – run by ex-Mercedes executive Tobias Moers – the deal is a lifeline. The maker of the $3 million Valkyrie supercar was on its last spin after an operating loss of 229 million pounds in the first nine months of the year – a dynamic which analysts reckon won’t turn positive until at least 2022.
Thanks to Daimler’s intervention, Aston’s barely sustainable net debt of 868 million pounds should fall substantially. Investors led by existing 20% shareholder Lawrence Stroll, who owns the Formula 1 team Racing Point, will inject 125 million pounds of fresh equity. Another 1.1 billion pounds in new debt will be used to refinance more expensive dues.
In return for driving to the rescue, Kaellenius appears to have dictated iron-clad terms. The tech transfer – which includes engineering nous on electric vehicles – is valued at 286 million pounds, according to Daimler.
That in turn will lead to Daimler increasing its current 2.6% stake to a maximum of 20% at a price of around 62 pence per share – a 15% premium to Aston’s close on Tuesday. However, if shares fall below the swap price, then Aston has agreed to compensate Daimler in cash, essentially capping its downside.
A partnership also makes strategic sense. Kaellenius recently announced plans to double sales of its high-end rides, including Maybach limos and the AMG racing brand, by 2025. Aston essentially gives him a free option on another super-premium marque.
Moreover, if Aston manages to hit a 500 million pounds EBITDA target by 2024 – a near tripling of investors’ forecast EBITDA for next year – then shares which have lost nine tenths of their value since an ill-fated IPO in 2018 should soar. For Kaellenius, that adds up to a joyride worth hitching on to