18th May 2023 13:05
(Alliance News) - Aston Martin Lagonda Global Holdings PLC on Thursday said it has received a "substantial investment" from Chinese vehicle manufacturer Geely International Ltd.
Hangzhou, Zhejiang-headquarter Geely produces and sells vehicles under its own brands, as well as subsidiaries such as Volvo Cars, Polestar, Proton and Lotus.
The luxury sports car maker announced a GBP234 million investment from Geely Holding. Geely will raise its stake in Aston Martin to 17%, buying 42 million existing shares at 335p from Yew Tree, who will remain the company's major shareholder.
It also will subscribe for 28 million new shares at the same price, which represents a considerable premium to Wednesday's closing price of 230.20p.
Shares in Aston Martin jumped 15% to 265.40p each in London on Thursday. In the year to date, the stock is up 71%, compared to a 0.9% increase for the wider FTSE 250.
Last year, Geely picked up a 7.6% stake in the company.
Back in 2020, Geely had expressed interest in buying up a stake in the firm back in 2020, launching a rival bid to Lawrence Stroll.
Canadian Stroll became executive chair in April 2020. He was part of the Yew Tree consortium which bought roughly a 20% stake in the company back in 2020.
Following the transaction announced on Thursday, Yew Tree will remain the largest shareholder with around a 21% stake, as Geely's rises to around 17%. Saudi Arabia's Public Investment Fund continues to have an 18% stake.
Executive Chair Lawrence Stroll said: "This announcement is a further significant step towards delivering our ambition for Aston Martin. Geely Holding, who initially became a shareholder last year, sees tremendous potential for Aston Martin's long-term growth and success. They offer us a deep understanding of the key strategic growth market that China represents, as well as the opportunity to access their range of technologies and components."
By Sophie Rose, Alliance News reporter
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