Monday 1 July 2019 10:15 am

Aston Martin's biggest shareholder to make £68m bid to increase its stake

Aston Martin’s largest shareholder, Investindustrial, is looking to increase its stake in the carmaker by a further three per cent.

It comes nine months after the luxury brand saw its shares crash by almost 50 per cent following its initial public offering.

Read more: Ford to cut 12,000 jobs across Europe and close down five sites

Italian private equity group Investindustrial already owns a 31 per cent share of Aston Martin.


The firm is considering the possibility of upping its stake by a maximum of three per cent, but must make an offer to all shareholders due to its large holding.

The private equity group is offering to pay 1000p per share, the price at which shares closed at on Friday.

It is some way off the 1900p per share the carmaker was listed at in its IPO.

It would mean Investindustrial pay around £68.4m to increase its stake to 34 per cent, although the offer would be made through independently managed subsidiary, Strategic European Investment Group.

The private equity firm has already secured agreements from existing shareholders to make the move and a final decision must be made by 29 July.

Aston Martin’s listing last October, which had valued the company at £4.3bn, raised £1.1bn for existing shareholders including Investindustrial and Kuwaiti-backed groups like Adeem Investments and Primewagon, which sold a quarter of the company.

“Investindustrial must see significant long-term value in Aston Martin at the current price if it wants to buy up to three per cent more of the business less than a year since it reduced its stake.”


Read more: Aston Martin braces for shareholder rebellion against chief executive’s pay

“Private equity companies often use IPOs as a way of providing a partial exit for an investment. They regularly do well at these stock market floats by getting a higher price than they originally paid to own all or part of a business privately. Doing a U-turn and rebuying stock in the market is untypical behaviour,” said Russ Mould, investment director at AJ Bell.

The carmaker, which suffered a loss during the first-quarter of this year, has seen its share price grow by 1.37 per cent in the wake of the news to 1,018p.

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