27th Oct 2020 17:33
(Alliance News) - Aston Martin Lagonda Holdings PLC on Tuesday unveiled plans for a bumper fundraising and an expanded technical pact with its investor Mercedes as the luxury carmaker looks to pocket GBP2 billion in annual revenue by 2025.
The measures are "transformational", Aston Martin Chair Lawrence Stroll said.
"It is the result of six months of enormous effort to position the company for success to capture the huge and exciting opportunity ahead of us," added Stroll, who was appointed back in April and owns the Racing Point Formula 1 team.
The expanded technology agreement with Daimler AG's Mercedes will see the German carmaker's stake in Aston Martin steadily increased to 20%.
"Today, we take another major step forward as our long-term partnership with Mercedes-Benz AG moves to another level with them becoming one of the company's largest shareholders. Through this new expanded agreement, we secure access to world-class technologies to support our long-term product expansion plans, including electric and hybrid powertrains and this partnership underpins our confidence in the future," Stroll added.
The company has also developed a new "business plan" which it hopes will see its annual revenue jump to GBP2 billion and adjusted earnings before interest, tax, depreciation and amortisation rise to about GBP500 million by financial 2025. It also targets volumes of 10,000 units.
In 2019, Aston Martin posted an adjusted Ebitda of GBP134 million on revenue of GBP997 million, less than half what it aims to net by 2025.
The plans will be supported by Aston Martin's latest fundraising plans, also unveiled on Tuesday.
The company plans to raise GBP125 million through a placing of 250.0 million at 50 pence each.
Aston Martin shares closed 4.5% higher at 54.50p each in London on Tuesday.
Aston Martin said it has received notice from Permian Investment Partners LP, Zelon Holdings Inc and Yew Tree Overseas Ltd to subscribe for GBP33.3 million, GBP30 million and GBP20 million worth of shares, respectively.
"The remaining approximately 83 million new ordinary shares will be made available in the placing to institutional investors via an accelerated bookbuild," Aston Martin added.
It also announced the launch of a GBP840 million senior secured notes offering. The notes will be issued by subsidiary Aston Martin Capital Holdings Ltd.
The proceeds will be used to redeem existing notes, repay other debts and be used for general corporate purposes.
Aston Martin also updated on its third-quarter on Wednesday. Revenue for the quarter came in at GBP124 million, down 49% annually from GBP244 million. It made an adjusted Ebitda loss of GBP29 million from GBP43 million profit.
On the host of measures unveiled on Tuesday, Chair Stroll added: "This is truly game changing. We now have the right team, partner, plan and funding in place to transform the company to be one of the greatest luxury car brands in the world."
By Eric Cunha; [email protected]
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