The fate of Aston Martin is likely to be decided this week, with India’s Mahindra & Mahindra favorite to become the British sports car maker’s new owner.
Mahindra’s rival for the acquisition of Aston Martin is Italian private equity fund Investindustrial, according to unnamed sources aware of these talks quoted by The Economic Times. On Saturday, Mahindra & Mahindra had bid higher than Investindustrial for a 50 percent stake. The Indian automaker wants to pick up a minority stake of 40 percent first, with the option of raising it to 50 percent.
Under the proposed deal, the three existing shareholders and the management team will retain the residual stake. Mahindra may have to pay between £120 million and £200 million for its strategic stake. Aston Martin is owned by a Kuwaiti consortium of financial sponsors led by Investment Dar, which bought the luxury car company from Ford in 2007 for £479 million.
The financial crisis affected the sales of sports cars and the Kuwaiti investors’ financials, with Investment Dar forced to restructure its $3.7-billion debt last year. The enterprise value of Aston Martin is expected to be a little over a billion dollars (£650-700 million), including a £300-million high yield bond issued last year.
Mahindra & Mahindra is the world’s largest tractor maker and the leading SUV manufacturer in India. It also controls South Korea’s Ssangyong Motor.
by Dan Mihalascu
) - Monday, November 26th, 2012 - filed under Aston Martin
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