Bad news?

[Retman]

mikey k said:

+1 That was pointed out early on which is why I was curious about DAR's % and what portion of that they are looking to off load.

Fairly impenetrable to obtain that due to Jersey co's; for the record:

PRIMEWAGON (JERSEY) LIMITED 720,997 ORDINARY GBP 0.001
ASMAR LTD 624,401 ORDINARY GBP 0.001
ADEEM AUTOMOTIVE MANUFACTURING CO LTD 362,578 ORDINARY GBP 0.001
DAR CAPITAL (UK) LTD 142,233 ORDINARY GBP 0.001
DAVID PENDER RICHARDS 32,571 ORDINARY GBP 0.001
DR ULRICH HELMUT BEZ 21,714 ORDINARY GBP 0.001

DAR UK owned by DAR CAPITAL (JERSEY) LTD also.

[Neil1300R]

The Investment Dar needs to retain at least 50% of the economic ownership of the company to ensure that a change-of-control covenant isn't triggered on £300 million of high-yield bonds, issued in July 2011 to refinance existing debt, according to two investors in Aston Martin's debt. A change-of-control covenant typically allows investors to sell their bonds back to the company at 101% of par value, an event described by one of the investors as "potentially disastrous."

And re the tie up with AMG:-
Investindustrial has an agreement with Daimler AG's DAI.XE +0.07% Mercedes unit to act as a technical partner on the deal with the German car maker providing engines, gearboxes and other technical expertise. Mercedes is also expected to take a small equity stake in the business if the acquisition goes through, the person familiar with Investindustrial said

Full article in the WSJ
http://online.wsj.com/article/SB100014241278873244...

[Speedraser]

DB9VolanteDriver said:

AMG tech going into an Aston? God help us....

Best thing for AM is someone with deep pockets who will treat AM as their pinnacle brand, as opposed to MB, where AM would just be another spoke on the wheel.

Go M&M !!!!

If M&M has enough money to fund Aston and leave them to do their own thing -- if this is not unrealistic, it could be ideal.

[Speedraser]

yeti said:

DB9VolanteDriver said:

AMG tech going into an Aston? God help us....

Best thing for AM is someone with deep pockets who will treat AM as their pinnacle brand, as opposed to MB, where AM would just be another spoke on the wheel.

Have a sinking feeling that Mahindras pockets are deeper and DAR don't really care enough about the brand to be interested in who wins... They are an investment group, therefore they exist to make money, as much as possible at whatever cost.

Investindustrial is a private equity group as is DAR, is it not? So this wouldn't fix that problem at all. Investindustrial would simply be looking to "make money, as much as possible at whatever cost" to AM, whereas M&M, in acquiring the marque as its showcase, might actually be looking to build a company for the long term.

[cardigankid]

F1 NDW said:

Ian Callum given a free hand again. Now there's a thought.

He has had a free hand at Jaguar. OK the XF is epic, the XK stunning, but the XJ and the F Type somehow don't quite hit the spot. At Aston Martin I would say that Reichman hasn't put a foot wrong. The new DB9 is is imho the prettiest vehicle ever created, especially in Volante form. V12V Zagato, brilliant, Rapide, brilliant, Vanquish Mk2, sublime, just sublime. Why fix what ain't broke?

[cardigankid]

Based on the Tata model I would say go with M&M. They will in any case regard Ratan Tata as a role model and may be likely to invest rather than asset strip. Toyota, ok, but it would be the first time I fancied one of their products. The Italians, probably just asset strippers.

[Jon39]

Thank you Retman.

We therefore now know,

PRIMEWAGON (JERSEY) LIMITED................................. 37.9%
ASMAR LTD ................................................................32.8%
ADEEM AUTOMOTIVE MANUFACTURING CO LTD ...........19.0%
DAR CAPITAL (UK) LTD ................................................ 7.5%
Mr DAVID PENDER RICHARDS ....................................... 1.7%
Dr ULRICH HELMUT BEZ ............................................... 1.1%

Most of the above were in the 2007 consorium, although I note
Mr John Sinders is not listed.

Also, I wonder who might be the owners of PRIMEWAGEN (JERSEY) LIMITED.

....................

Whilst looking up some of the above shareholders, I found the following historical
items that might be of interest.

http://www.automobilemag.com/features/news/0706_q_...

http://www.efinancialnews.com/story/2010-10-11/ast...

It appears that the (second link) webpage, can only be viewed once. If looked at again, an invite to register appears. The workaround is to delete your cookies.

Edited by Jon39 on Tuesday 27th November 21:07

[Neil1300R]

Jon39 said:

Thank you Retman.

We therefore now know,

PRIMEWAGON (JERSEY) LIMITED................................. 37.9%
ASMAR LTD ................................................................32.8%
ADEEM AUTOMOTIVE MANUFACTURING CO LTD ...........19.0%
DAR CAPITAL (UK) LTD ................................................ 7.5%
Mr DAVID PENDER RICHARDS ....................................... 1.7%
Dr ULRICH HELMUT BEZ ............................................... 1.1%

Most of the above were in the 2007 consorium, although I note
Mr John Sinders is not listed.

Also, I wonder who might be the owners of PRIMEWAGEN (JERSEY) LIMITED.

....................

The deal was then valued at $925m (£480m) and the Dar's 51% share was partly financed by several international banks which had agreed to a $393m sharia-compliant loan.

[yeti]

My fear with M&M is that they do a Shanghai Automotive/Rover type thing and look to shift production long term or just badge-up mediocre crap. If they do a TATA/JLR, all well and good.

InvestIndustrial are indeed a private equity firm, as I probably didn't need pointing out, but thanks. But they have a proven track record with Ducati (conceptually similar to AML) and bring AMG's engines to the company. M&M bring nothing, they just want playground bragging rights as far as I can see. Or are they offering to plunge hundreds of millions of investment into the company which they'll need without the AMG tie-up..? If so, tally ho. My guess is they have 300MM burning a hole in their pocket and want to go one up on TATA.

Only Aston can trump Jaguar and it's cheaper than a Premiership football club. Maybe this is what the biIllionaires are playing with now

[steveatesh]

yeti said:

Only Aston can trump Jaguar and it's cheaper than a Premiership football club. Maybe this is what the biIllionaires are playing with now

My fear is that it is just a large Scalextric to them but they haven't got the money to make it work well. If they bring a large cheque book great, if not then can't see how A M will benefit from what others have said on here....

[Mr Viking]

Arjxh56 said:

Maybe we should all chip in a few quid, im sure we could scrape enough together ... especially if those of you with rich wives/girlfriends join in!?

I have a tenner or so in my piggy bank

[FatFrank]

DB9VolanteDriver said:

A car (or other automotive related company) buying AM as a trophy is just what AM needs. People should remember that Ford bought AM for the very same reason. Once bought, they injected massive amounts of money into AM, which is still bearing fruit at AM today.

It wasn't just the money that Ford poured into Aston that made it what it is today, it was the parts bin. Without the equivalent wealth of resource to draw from it wouldn't be long before whoever invests in Aston either, severly compromises the future product, or chokes on the cost of making new vehicles. Ford brought everything from engines to instrument clusters into our cars. Ultimately we need a company with similar resources to that which Ford had if we want to see the next generation of cars that we all desire. BMW, MB, VAG, JLR or even Toyota with its demonstrated LF-A mindset would be better than M&M.

FF

[DB9VolanteDriver]

FatFrank said:

It wasn't just the money that Ford poured into Aston that made it what it is today, it was the parts bin. Without the equivalent wealth of resource to draw from it wouldn't be long before whoever invests in Aston either, severly compromises the future product, or chokes on the cost of making new vehicles. Ford brought everything from engines to instrument clusters into our cars. Ultimately we need a company with similar resources to that which Ford had if we want to see the next generation of cars that we all desire. BMW, MB, VAG, JLR or even Toyota with its demonstrated LF-A mindset would be better than M&M.

FF

You're right, but that was then, this is now. At the time, AM had nothing and needed everything, as you point out, so Ford was ideal. Today, they don't need to start from scratch. They just need some money for R&D for new drivetrains. The VH concept is more than adequate as is.

[Jon39]

FatFrank - well said.

I wonder whether AM enthusiasts were anxious in 1994, when Ford made their purchase. Possibly there might have been a feeling that AM could be absorbed into the parent company models.

As we now know, it was a great period in Aston Martin's history, but only because of the points mentioned so clearly by FatFrank.

That particular aquisition (of one motor manufacturer by another) is probably fairly unusual, in that it eventually benefited the smaller company.

If we could remember them all, the sports car manufacturer disaster list is very long (including TVR). None of us wish future financial difficulties for Aston Martin.

Reference has been made to Mercedes Benz. Remember they owned Chrysler for a time. All I can recall now, is of an SLK with a Chrysler badge on it, that the company was eventually rescued from the brink by Fiat, and there is now a Lancia Epsilon with a Chrysler badge on it.

Under Ford's stewardship, taking annual production from 127 cars, to over 7000 was a tremendous achievement. A considerable increase from present levels would cost a fortune, and not be at all easy.
Higher volumes might even work against the product desirability.

Ford sold at the peak of the market. Production numbers, profits (and presumably therefore the company value) are now lower.

So, my point is that many circumstances are now very different from those in 1994, when Ford arrived.

Perhaps the ideal for Aston Martin would be input of money for product development, by someone who does not interfere, does not put AM badges on their products (or vice versa), and who is not hoping for a commercial return on their money.

[Guycord]

We can all work-out the approximate math very easily:-

4,000 cars per annum, GBP120k average retail around the globe. Deduct sales taxes, Dealer margin, corporation tax and I bet AML are left with approx GBP12K per unit margin. Thats GBP50M per year max to develop and market everything.

So where is the investment opportunity, the risk/return and all the new stuff going to come from?

For me, AML should plod-on buying other OEM race-grade components and wrapping them up in a bit of CF and leather. It will be out and out absorption in to a large multi-national, with a high probability of eugenics, or the status quo remain until....

I dont think anyone out there will be doing this as a hobby

[Mr Aston Martin]

Guycord said:

We can all work-out the approximate math very easily:-

4,000 cars per annum, GBP120k average retail around the globe. Deduct sales taxes, Dealer margin, corporation tax and I bet AML are left with approx GBP12K per unit margin. Thats GBP50M per year max to develop and market everything.

So where is the investment opportunity, the risk/return and all the new stuff going to come from?

For me, AML should plod-on buying other OEM race-grade components and wrapping them up in a bit of CF and leather. It will be out and out absorption in to a large multi-national, with a high probability of eugenics, or the status quo remain until....

I dont think anyone out there will be doing this as a hobby

Which is why in the short term it's more likely we will see another manufacturers engine powering Astons.

From reports a 40 % equity share is on offer. AML is carrying substantial debt and requires heavy investment post deal to take the company forward.

Based on the above and seemingly with no operational control for the successful bidder over the business then you have to ask why would anyone bid?

Or is it that the companies that offer a more suitable strategic fit aren't in the running and are waiting in the wings until positions deteriorate?

[drmw]

Mr Aston Martin said:

Which is why in the short term it's more likely we will see another manufacturers engine powering Astons.

In my opinion, if it was AMG that would be a good outcome - vastly more efficient engines

[George29]

drmw said:

In my opinion, if it was AMG that would be a good outcome - vastly more efficient engines

Only the new turbo ones. The N/A engines that would be much more suited to Aston aren't really that much more efficient.

[mikey k]

FatFrank said:

It wasn't just the money that Ford poured into Aston that made it what it is today, it was the parts bin. Without the equivalent wealth of resource to draw from it wouldn't be long before whoever invests in Aston either, severly compromises the future product, or chokes on the cost of making new vehicles. Ford brought everything from engines to instrument clusters into our cars. Ultimately we need a company with similar resources to that which Ford had if we want to see the next generation of cars that we all desire. BMW, MB, VAG, JLR or even Toyota with its demonstrated LF-A mindset would be better than M&M.

FF

Exactly why I wish Toyota would come back to the party
AM need another Ford IMHO

BTW Is it weird I find Bez's middle name hilarious Helmut

Edited by mikey k on Wednesday 28th November 14:56

[cardigankid]

FatFrank said:

DB9VolanteDriver said:

A car (or other automotive related company) buying AM as a trophy is just what AM needs. People should remember that Ford bought AM for the very same reason. Once bought, they injected massive amounts of money into AM, which is still bearing fruit at AM today.

It wasn't just the money that Ford poured into Aston that made it what it is today, it was the parts bin. Without the equivalent wealth of resource to draw from it wouldn't be long before whoever invests in Aston either, severly compromises the future product, or chokes on the cost of making new vehicles. Ford brought everything from engines to instrument clusters into our cars. Ultimately we need a company with similar resources to that which Ford had if we want to see the next generation of cars that we all desire. BMW, MB, VAG, JLR or even Toyota with its demonstrated LF-A mindset would be better than M&M.

FF

OK but what did Tata bring to JLR?