(Reuters) - Italian private equity fund Investindustrial is likely to announce it will invest in British sportscar maker Aston Martin on Friday, two people familiar with the matter said on Thursday.
"It's probable that there will be an announcement," one of the two people said, declining to elaborate on what the deal would entail. "It's not 100 percent certain, but it's probable."
Indian tractor maker Mahindra and Mahindra (MAHM.NS) had been in talks to inject cash into the iconic sportscar brand from Aston's owner, Kuwaiti investment house Investment Dar, sources said. It was not clear whether it had pulled out of the race.
Investindustrial had earlier bid between 200 million and 250 million pounds ($400 million) for a 50 percent stake and agreed on a technical partnership deal for Aston Martin with Daimler' AG's Mercedes (DAIGn.DE), another person told Reuters on November 23.
Investindustrial, owned by Italy's Bonomi family, is not new to luxury motor brands. In 2006, it bought Italian motorcycle maker Ducati and sold it for about 860 million euros last April to Volkswagen's (VOWG_p.DE) Audi division.
The Indian group had hoped to strike a deal to buy up to half of Aston Martin by the end of November, sources said at the time, adding that the deal would likely be for an initial 40-percent stake that could rise to 50 percent for a total price of around $400 million.
Investment Dar has consistently denied it is in talks to sell all of part of its stake in Aston Martin. A spokesman for Investment Dar was not immediately available for comment, nor could Mahindra be reached for comment.

 

Here's the AM website link:

http://www.astonmartin.com/en/news?n...4-4f54b257f30b

Seems like there may be AMG in Aston's future. No tractors, then, LOL...

 

I'm curious. What is the general consensus then if MB bits make their way into our beloved Astons?

 

By GILLES CASTONGUAY

MILAN—The turbulent ownership history of Aston Martin, the British luxury car brand famed for its links with fictional spy James Bond, has taken an Italian twist.
Private-equity firm Investindustrial has agreed to buy a stake in Aston Martin Lagonda Ltd. as part of plans by its indebted Kuwaiti parent, finance house Investment Dar, to raise fresh cash to develop new cars for the British luxury brand.
Investindustrial said it is paying £150 million ($241 million) for a 37.5% stake via a capital increase, giving Aston Martin an enterprise value of about €940 million. Investindustrial said it has 50% of Aston Martin's voting rights. It beat out Indian auto maker Mahindra & Mahindra Ltd. 500520.BY +0.74% in Investment Dar's search for a new partner for Aston Martin.
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Reuters


James Bond's Aston Martin of choice in the mid-1960s and again this year; an Italian private-equity group is sinking close to $250 million into the car's maker.



Heard on the Street

• Aston Martin Needs Italian Golden Finger

Investindustrial, which was founded by Italy's Bonomi family and is based in London, gained notoriety in April for having sold Italian motorcycle maker Ducati Motor Holding SpA to Volkswagen AG's VOW3.XE +0.73% Audi NSU.XE 0.00% unit.
Aston Martin, whose classic 1963 DB5 model made a new screen appearance in the latest James Bond movie "Skyfall," is struggling to match its fame with financial success in a capital-intensive industry where scale is increasingly important in tapping demand for top-of-the-range cars in emerging markets.
Other famous British luxury auto brands are owned by big auto-making groups. Bentley is owned by Volkswagen, Europe's leading auto maker by sales. The Jaguar Land Rover Group is owned by India's Tata Motors Ltd. 500570.BY +0.37% while Rolls-Royce is in the hands of BMW BMW.XE +0.55% AG.
"Investment Dar has been looking for a buyer for over a year—Aston Martin doesn't have the cash flow to fund next generation cars or engines," said Bernstein Research analyst Abbas Quettawala. "It needs to be part of a bigger industrial business to be profitable," Mr. Quettawala said.
"Bentley and Lamborghini are barely profitable but it doesn't matter to their parent Volkswagen because of it has other, profit-making brands," Mr. Quettawala said.
Aston Martin will be able to invest more than €625 million in new products during the next five years, Investindustrial said. The deal is subject to antitrust clearance, expected in the first quarter of 2013, it said.
Aston Martin currently has 146 dealerships in 241 countries. Its sales are split approximately a quarter each to UK, Europe, Asia-Pacific and U.S.
Aston Martin is one of the few remaining independent niche players in the luxury auto market, which can bring the kind of customer experience that is often missing in a brand owned by a big conglomerate, said Andrea Bonomi, senior principal at Investindustrial. "We are in it for the long haul," he added.
Mr. Bonomi said Daimler AG's DAI.XE +0.39% Mercedes is interested in becoming a technical partner but no agreement has been signed yet. The idea is to have Mercedes engines replace Ford engines.
Investindustrial had a link with Aston Martin two decades ago when it invested in gearbox engineering firm David Brown, a former owner of Aston Martin. Investment Dar and other investors bought Aston Martin in 2007 from Ford Motor Co. F +2.14% for £479 million ($768.8 million).
"Investindustrial was the best fit experience sector wise with its previous ownership of Ducati. Investment Dar didn't want to sell outright but wanted a strong partners to help it grow globally especially in China," said Sarah Calam, spokeswoman for Aston Martin.
Based in Gaydon, England, Aston Martin had earnings before interest, taxes, depreciation and amortization, or Ebitda, of €101 million on sales of €634 million in 2011, according to the statement.
But it has been running a net loss as it has struggled to cover costs, according to a Nov. 14 report by Bernstein Research, that estimated Aston Martin making less than 5,000 cars this year. Its models include the Vanquish and the Vantage. Mr. Quettawala said Aston Martin needs to be able to compete especially in China where it derived just 5% of its 4000 or so unit sales in 2012.
The latest version of the Vanquish, a 12-cylinder 5.9-liter grand tourer, is expected to go on sale in 2014, retailing at around $300,000.
—Marietta Cauchi in London and Christopher Emsden in Rome contributed to this article.

 

Absolutely fantastic! Look what Aston did with Ford bits...........

 

I'm sorry, all this is bad information. Sniff Petrol reports:

Aston investment money gone

Posted in News by Sniff Petrol on Friday, December 7th, 2012
There was embarrassment for investment firm Investindustrial today as it confessed that the £150m it has just put into Aston Martin has already gone.

‘We thought 150 million would go a long way,’ admitted an Investindustrial source. ‘But when we decided to go for Aston Martin we knew we wanted the contrast stitching on the seats and a carbon fibre finish for the dash and then we realised you have to pay extra for a better stereo and parking sensors and, well it all adds up doesn’t it? Now there’s no money left. Sorry.’

Nonetheless, Aston Martin itself is confident that Investindustrial’s patronage will make it easier to raise the £500m it needs for the future. There are unconfirmed reports that this money will be used to hire ex-Lotus boss Dany Bahar and then cover his expenses for three months.

 

Man that's bad news .... Why does aml need a new boss, bez was doing a good job with vision and engineering and keeping an eye toward cost by integrating ford and Volvo bits, the company operating at a loss with a very modes EBITDA i think is more of a sales vs production and burn rate expenses issue.

 

I think he was kidding.

 

HA, HA HA!!!!! Good one.

The 150M is just enough to buff them up so AMG and Merecedes will be willing to do a deal.

I thought the best part of this news is that the large technology partner for Aston Martin appears to be now identified. The strategy is working for VW group, maybe Mercedes will follow along. I hope so.

 

Now _that_ was funny. Sounds like they went for the B&O stereo option.

 

haha, I do love the Sniff Petrol, always have some great items.
Funny enough, I just posted the same link on a different forum!

 

Widely varied opinions... I hope it's a good thing. Yes, as FatFrank says, Aston did great things under Ford, but that's because Ford treated Aston with huge respect and let Aston develop its own chassis -- no platform sharing for the Gaydon cars. The engines are so distanced from any Ford/Jaguar basis as to be unique-to-Aston engines. If this is the kind of thing that happens (if M-B does get involved), it could be fantastic.

HOWEVER... If they go down the VW Group path of sharing major components, not just minor ones or tech knowledge, then IMO that would be a complete disaster. If Astons become Benzes underneath, I'd have zero interest in buying another one. If they simply drop a Benz or AMG engine into Astons - no thanks. I know M-B makes some great engines (especially AMG), but I don't want an Aston with someone else's engine. And no, different software and exhausts isn't enough of a differentiator.

 

Exactly the same sentiment here.