Aston Martin set for public offering before end of 2018

Impending stock exchange flotation gets investors excited

Aston Wales Jpg

YOU might not be able to afford an Aston Martin, but you’ll soon be able to own part of the company.

Reuters has confirmed one of the worst-kept secrets in the automotive world, namely that Aston Martin is going public.

The necessary documents have already been filed with the UK Financial Conduct Authority, a prospectus will be issued at the tail end of September, and approximately 25 percent of the company will be listed on the London Stock Exchange before the end of the year.

The public offering values the company at around A$12.2bn, not bad for a company that has only just recorded its first full year profit for eight years and has a history of filing for bankruptcy seven times.

Financial projections look rosy, however, with demand for DB11 seeing a ramp-up in production to around 6300 units, investment in a new factory in Wales set to bear fruit and, most importantly, the addition of the DBX crossover, which is expected to boost sales from the current circa 6300 cars per year figure to around 10,000 sales per annum by 2020.

While the slow progress of Brexit negotiations may have dulled some investors’ enthusiasm in buying into a British car manufacturer, Andy Palmer, the company CEO, has confirmed that the timing of the float has been designed to coincide with the announcement of a trade deal between the UK and the European Union; a market that accounts for a quarter of Aston’s registrations.

Palmer has been bullish on record regarding the knock-on effect of various Brexit scenarios. “If there is a tariff into Europe, it's countered by a tariff into the UK for our competitors, so you might lose a little bit of market share in the EU but you pick it up in the UK," he said. Palmer admitted that Aston Martin is stockpiling engines, many of which are sourced from the German company AMG, in preparation for "border delays after Brexit".

Aston Martin’s current investors include private equity firm Investindustrial and an investment house based in Kuwait. Mercedes-Benz owner Daimler (DDAIF), which has a stake of nearly 5 percent, will remain a significant shareholder. As well as solidifying Aston Martin’s financial status after years of travails, the offering also looks to replicate the success of Ferrari, which has seen the boom in high-end vehicle sales result in its stock more than doubling since it went public in 2015.

 

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