THE HISTORY OF ASTON MARTIN is one of ups and downs. Now the company has announced that it intends to list on the London stock exchange and the predicted share price of between 1750 pence and 2250 pence per share values the car company at up to $9.2 billion.
CEO (and former Nissan executive) Andy Palmer predicted that Aston Martin was a luxury brand capable of rivalling Ferrari for profit and market capitalisation.
Not all analysts were so confident, with some suggesting that Aston Martin’s financials were “fragile”, the balance sheet undercapitalised and the possibility of strong profits as “uncertain”.
Shares in the company are being offered at between 1750 pence and 2250 pence per share, valuing the company at between $7.3 billion and $9.2 billion. Most analysts think the actual price will be somewhere in the mid-range.
We all know the warning that “past performance is no guarantee of future performance” and with Aston Martin, most investors will be hoping that it isn’t.
The company was started by Lionel Martin and Robert Bamford (as Bamford and Martin Limited Company) in 1913. The car they produced was called the Aston Martin, after one of the founders and the name of the Aston Hills where Martin had raced.
Bamford left the company in 1920, although nobody knows why. By 1922, the company was doing well, but went into bankruptcy in 1924.
After 1926, the company underwent a series of changes of ownership by investment companies and consortiums. Ford assumed a 75 percent stake in the company in 1987. Twenty years later, a Kuwait consortium paid $US975 million for the company. In 2012, a consortium of shareholders led by a British-registered fund acquired a large stake in the company, valuing it at £975 million. Former Nissan man Andy Palmer was appointed president and CEO in 2014.
Mr Palmer says the company plans to launch a new model each year over the next seven years and boost production to 10,000 vehicles a year.
However, canny investors are already making good money out of Aston Martin – by investing in the cars rather than the company.
The Bonhams Goodwood Festival of Speed 2018 auction on Friday 13 July sold the ex-Essex Racing Stable 1961 Aston Martin DB4GT Zagato for £10,081,500 (AU$18,216,616), making it the most valuable British car ever sold at a European auction. Less exalted Astons also performed well, with the 1965 James Bond GoldenEye DB5 Sports Saloon achieving £1,961,500 (AU$3,544,303), a 1989 V8 Vantage X-Pack Sports Saloon sold for £393,500 (AU$711,028), a 1967 DB6 Vantage Volante made £450,000 (AU$813,120), a 2017 Vanquish S Coupe sold for £163,900 (AU$296,156), a 1967 DB6 4.5-litre Sports Saloon brought £203,100 (AU$366,988), and a 1964 DB5 4.3-litre Sports Saloon cleared £449,500 (AU$812,217). Even a one eighth scale model of the Goldfinger DB5 earned its owner £1000 (AU$1806)!