Published by Global Banking and Finance Review
Posted on March 31, 2025
By Shashwat Awasthi
(Reuters) - Aston Martin will raise more than 125 million pounds ($161.9 million) through funding from its chairman and the sale of its stake in his Formula One team as it battles ballooning losses and tariffs imposed by U.S. President Donald Trump.
Shares of the company famous for being fictional secret agent James Bond's car of choice had surged 11.8% to 72.95 pence by 0930 GMT on Monday.
The equity raise is Aston Martin's seventh since the arrival in 2020 of Chairman Lawrence Stroll, who has pumped around 600 million pounds into the luxury carmaker.
Delivery delays and depressed demand in China have plagued the company in recent years, forcing it to cut 5% of its workforce last month.
Stroll's Yew Tree Consortium will invest a further 52.5 million pounds by purchasing 75 million shares at 70 pence per share. His stake will rise to about 33% from 27.7%, with the possibility of increasing further to up to 35%.
Yew Tree will seek a waiver from a rule that requires an entity owning more than 30% of a UK-listed company to make an offer to buy out the remaining shareholders.
"Exemptions have been granted in the past, yet it feels like a takeover would be a better outcome as it would mean the car company would be free to pursue a turnaround strategy out of the public spotlight," said Russ Mould, investment director at AJ Bell.
The sale of a stake in the Aston Martin Aramco Formula One team will help the company realise a premium to the current book value of about 74 million pounds, but will not affect an existing long-term sponsorship deal, the carmaker said.
The Trump administration's tariff on imported vehicles forced the company to now forecast "modest growth" in annual car volumes, compared with mid-single digit percentage growth earlier.
The U.S. contributed more than a third of Aston Martin's revenue last year.
Further impact from the levy was being reviewed, the company said, but it backed its target of positive operating earnings in 2025 and being free cash flow positive in the second half.
($1 = 0.7723 pounds)
(Reporting by Shashwat Awasthi in Bengaluru; Editing by Krishna Chandra Eluri, Kirsten Donovan and Jan Harvey)
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