Aston Martin’s Biggest Investor Considers Acquiring Another Stake
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The biggest investor in Aston Martin is considering buying another 3% stake, offering to increase its holding after shares in the luxury carmaker crashed almost 50% since its listing nine months ago.
Strategic European Investment Group, part of the Italian private equity group Investindustrial, owns 31% of Aston Martin. It only wants to buy a maximum 3% stake but has to make an offer to all shareholders due to its already large holding.
It has secured agreements from existing shareholders such as a group of Kuwait-based investors to back the move.
It is offering to pay 10 pounds ($12.68) per share, the price at which the shares closed on Friday. It must make a decision by July 29.
Aston Martin has struggled since it listed in October last year. Its shares fell on the opening day and are now down 47 percent. The company’s recent results have been hit by a need to invest more in its manufacturing plants and expand its vehicle offering, leading to higher costs.
Questions & Answers
Q.Which company is Aston Martin's biggest investor and considering increasing its stake?
Which company is Aston Martin's biggest investor and considering increasing its stake?
Strategic European Investment Group, a division of the Italian private equity group Investindustrial, is the largest investor in Aston Martin. It currently owns 31% of the luxury carmaker and is contemplating purchasing an additional 3% stake.
Q.Why does the biggest investor have to make an offer to all shareholders for such a small stake?
Why does the biggest investor have to make an offer to all shareholders for such a small stake?
Due to its already substantial holding in Aston Martin, Strategic European Investment Group is obliged to make an offer to all shareholders. This applies even though it only intends to acquire a maximum of 3% more shares.
Q.What are the reasons given for Aston Martin's struggles since its listing?
What are the reasons given for Aston Martin's struggles since its listing?
Aston Martin has struggled due to increased investment needs in its manufacturing plants and a desire to expand its vehicle range. These factors have led to higher operational costs for the company since its listing.
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