Aston Martin looks to be getting closer to floating an initial public offering on the stock exchange. The British automaker has been rumored to be pursuing an IPO for the past few years. But now Reuters reports that it’s preparing to hire three major banking firms to handle the initiative, indicating that the move could be coming up soon.
The capital raised by an IPO would ostensibly help the company fund major investments it has under way. For one, it’s building a new factory in Wales. That’s where it will build the new DBX crossover (or whatever it’s ultimately called).
For another, it’s preparing to relaunch the Lagonda brand as a high-end electric vehicle manufacturer, delving into new territory for the automaker. It’s also contemplating a venture into Formula One as an engine supplier, likely for its close partner Red Bull Racing.
These in addition to the rollout of new models to replace its aging lineup. It recently introduced the new DB11 and Vantage. A successor to the current Vanquish could be next. The Rapide is growing long in the tooth. And it’s also working to bring the Valkyrie hypercar to market, with another mid-engined supercar to slot in underneath it.
The hundred-year-old company is currently owned by Italian private equity fund Investindustrial and a consortium of other investors (principally from Kuwait). Each would likely give up a portion of its shares in return for a proportion of the funds generated by the stock issue.
Following Ferrari’s Lead
Aston Martin Lagonda Limited (as the company is officially incorporated) wouldn’t be the first exotic automaker to float an IPO. Ferrari separated from parent company Fiat in 2015 and floated shares on the New York Stock Exchange under the handle RACE.
The Volkswagen Group owns several more of Aston’s rivals, including Porsche, Lamborghini, Bugatti, and Bentley. McLaren is owned by a pair of Middle Eastern investors (from Bahrain and Saudi Arabia). Maserati remains part of the Fiat Chrysler group of which Ferrari was once part. And Jaguar is owned by Indian automaker Tata.
According to the report, the Aston Martin IPO would be handled by Deutsche Bank, Goldman Sachs, and JPMorgan. The latter is one of the many underwriters of Ferrari’s IPO, along with Santander, UBS, BNP Paribas, Mediobanca, and Allen & Company LLC. Aston’s IPO is estimated to be worth between four and five billion pounds, or roughly $5.6 to 7 billion in equivalent American funds – far more than previously thought.