ASTON Martin is preparing to raise funds to expand its range of models into new areas including crossover SUVs, two sources with knowledge of the matter said, as the loss-making sports car maker steps up its turnaround efforts under a new boss.
The British high-end marque is working on plans to issue new shares or bonds and extend its current recovery strategy by three years to 2020, the sources said, adding that luxury sedans and hybrid models also featured in its plans.
“It’s an expansion from the current model range,” one source said, speaking anonymously because the matter isn’t public.
Aston Martin, James Bond’s carmaker of choice, is the underdog in a British luxury auto industry dominated by Tata-owned Jaguar Land Rover, its next-door neighbour in the Warwickshire village of Gaydon.
Held back by its ageing models and weak investment, the company has missed out on a luxury car boom that saw the global market almost double in five years. Last year it delivered 4,200 cars, far short of a pre-financial crisis peak of 7,300 in 2007.
Aston Martin is examining debt- or equity-raising options to finance a bigger plan, the sources said. Further cash will be freed up by more efficient management of working capital such as vehicle and parts inventory.
The fundraising would generate £100-150 million, with any new shares offered to current investors, said one of the sources, close to the strategy discussions.
Aston Martin and its main private-equity backers, Kuwait’s Investment Dar and Italy’s Investindustrial, declined to comment. Bondholder Waddell & Reed did not return calls.
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Milan-based Investindustrial and the Kuwaitis together control 93 percent of Aston Martin, acquired in successive capital raisings since Ford sold the company in 2007.
A further 5 percent is held by Daimler, underpinning a partnership struck last year for the German firm to supply Mercedes engines and technology to Aston Martin.
Aston has already begun updating existing models under a £500 million investment strategy drawn up in 2012, when Investindustrial paid £150 million for a 37.5 percent stake.
That plan sees a replacement for the £120,000 DB9 in late 2016 and a return to profitability the following year.
At a lavish party in London last week, new Chief Executive Andy Palmer unveiled a DB10 concept car that will feature in the next Bond film, “Spectre”, and may offer design clues about future production models.
“It will come as no surprise when I say that the year ahead is going to be busy across the board,” Palmer told guests.
Daimler has also said it could share SUV architecture with Aston.
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