Thursday 23rd June 2011

Aston Secures £304m Funding For New Models

'Senior Secured Note' issue gives Aston Martin a boost

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Aston Martin has (it says) set itself on a stable financial footing with the announcement of a £304m bond issue. (The one we mentioned in our recent analysis of the company's big challenges.)

Aston says the funding gives it the security it needs for the next seven years, and will allow it the means to develop new models.

"Our successful bond issue represents a milestone and provides strong, long-term financial foundations for the company as we enter a new phase of growth," says Aston CEO Dr Ulrich Bez.

[EcosseBMW]

Good news!

[fatboy b]

Just feels about 3 years too late.

[JumpinJack]

I wish my company could get funding like that

[tridave]

JumpinJack said:

I wish my company could get funding like that

Effectivly just a loan

[Fetchez la vache]

£300m to fund 4 new models? They have to be kidding? Maybe I've got the sums from major manufacturers on my brain, but that sounds way too cheap...

[S3K04]

Is 300 million even enough for a new model + new engine + marketing ?

[gary71]

S3K04 said:

Is 300 million even enough for a new model + new engine + marketing ?

No. Not if you do it properly.

Heavy facelift inside and out of one car, and a major engine refresh of one variant might just fit within that figure.

But funding is good news. It's 300m more than they did have!

[Rawwr]

Or 1 major platform revision with 4 different shells.

[wab172uk]

Rawwr said:

Or 1 major platform revision with 4 different shells.

With 1 engine and 1 dashboard.

[Rawwr]

Power. Beauty. Soul. Cobbled. Together. From. Single. Parts. Bin.

[944fan]

£304M from Bond? About time he gave some money back, all the free cars he's had and smashed.

[soad]

944fan said:

£304M from Bond? About time he gave some money back, all the free cars he's had and smashed.

[LuS1fer]

I thought the Bond issue was that he was going back to Bentley.
Good luck to AM though - despite their foibles and critics they remain a very strong marque in terms of brand status, perhaps belying their actual capability, so let's hope they build on it.

[nsa]

It pays 10% at today's prices if anybody is interested. Minimum ticket size is £100k though.

[Knallfix]

I can't see anything in the press release of what is mentioned in the official prospectus under the "use of proceeds" section, namely that part of the borrowing is aimed at paying the shareholders a dividend. Ulrich Bez - sod the "Doctor Bez" crap - appears to be a tad disingenuous..... I quote from the indenture: "We currently intend to use the proceeds to repay the Existing Senior Facilities, redeem the Preference Shares (after closing of the offering), pay an accrued and unpaid dividend on the Preference Shares, make a distribution to our Shareholders, with the balance to be used for Rapide related capital expenditures and working capital."

Now what about that? I do wish Bez would stop treating AML like his personal plaything.

[bermy boy]

Knallfix said:

I can't see anything in the press release of what is mentioned in the official prospectus under the "use of proceeds" section, namely that part of the borrowing is aimed at paying the shareholders a dividend. Ulrich Bez - sod the "Doctor Bez" crap - appears to be a tad disingenuous..... I quote from the indenture: "We currently intend to use the proceeds to repay the Existing Senior Facilities, redeem the Preference Shares (after closing of the offering), pay an accrued and unpaid dividend on the Preference Shares, make a distribution to our Shareholders, with the balance to be used for Rapide related capital expenditures and working capital."

Now what about that? I do wish Bez would stop treating AML like his personal plaything.

So...this debt offer (=long term loan) is replacing existing loans (ie not "new money"), paying dividends to shareholders (money going out the door) and using the rest for an existing model. Maybe I'm missing someing but there appears to be a small proportion of the $300M actually available to invest in new models. So instead they put it into an existing one that doesn't sell much. Lets not get our collective hopes up here...

[suffolk009]

BOND SAVES ASTON MARTIN

It's worthy of the red-tops.

[Knallfix]

Well done, Bermy Boy, you've got it.

What the pompous Herr Betz has done - if he wants to be "Herr Doktor"' then I will insist on being called "Herr Magister" - is what is quite common in private equity, namely to borrow money to buy a company and then borrow in the markets, pay yourself back for the loans you took out, pay yourself a special dividend leaving yourself owning all the shares free of charge and leaving all the risk with the lenders. I thought that scam went out with the credit crash in 2007. Of course, PT Barnum did say that there's a sucker born every minute....

Betz is due to retire soon and I suppose his pension pot needs a bit of a top up. I wonder whether he secretly wears a kakhi suit and sits stroking a fluffy white cat? Well, he couldn't fool me and now he can't fool you either.....