Aston Martin to be floated on the stock market

The UK-based sports and supercar manufacturer will be floated on the stock market to help fund its continued expansion and modernisation

Aston Martin is to be floated on the stock market, aiming to launch the prospectus for its Initial Public Offering (IPO) on 20 September. Registration documents, submitted to the Financial Conduct Authority (FCA), are due to be published later today.

The IPO is expected to value the sports car maket, which is currently owned by Italy's Investindustrial and Kuwaiti vehicle Investment Dar, at £5bn. It's thought that a fifth of Aston Martin Lagonda's shares would be sold, with around 2700 staff benefiting from a share scheme. Existing Aston Martin customers may also be given preference.

The announcement was made as financial results for the first half of 2018 were released, which showed revenues up 8% year-on-year to £445m. Adjusted underlying profits were 14% higher at £106m.

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Andy Palmer, president and chief executive of Aston Martin, announced, 'Today's announcement represents a key milestone in the history of the company, which is reporting strong financial results and increased global demand for its award-winning sports cars.

'As we continue to execute our Second Century Plan, combining a product offensive and expanding manufacturing footprint, we have the resources and balance sheet strength to continue delivering on our growth strategy.

'Today's results show that we have continued to deliver sustainable growth, margins and value for our shareholders whilst launching three new models and variants in the first half of the year.'

The flotation will help to fund the company's expansion plans, which include the opening of an additional factory (below) in St Athan in Wales in 2019.

The plans would make the first UK carmaker to float in London since the 1980s. Ferrari was the last major sports car manufacturer to launch an IPO: it did so in New York three years ago, with the the brand valued at $10bn at the time. Its market value is currently $24bn.

Aston Martin's financial history

Aston Martin was founded 105 years ago, in 1913, by Lionel Martin and Robert Bamford. The latter left in 1920 and Bamford & Martin was revitalised with funding from racing driver Count Louis Zborowski. The company went bankrupt in 1924 and was bought by Lady Charnwood who put her son John Benson on the board.

Bamford & Martin went bust again in 1925 and the factory closed in 1926, with Lionel Martin leaving. It was then taken over by Bill Renwick, Augustus (Bert) Bertelli and other investors including Lady Charnwood.

By 1932 Aston Martin was struggling again, this time to be rescued by Lance Prideaux Brune, who then handed it on to Sir Arthur Sutherland. However, the company really took off after the war when, in 1947, the privately owned tractor and machine tools manufacturer David Brown Limited bought Aston Martin.

David Brown also bought Lagonda's business, and moved operations to Newport Pagnell, soon starting the now-iconic 'DB' (for David Brown) range of cars. In 1972, David Brown paid off all the company's debts, thought to be £5 million, and handed over the company for £101 to Company Developments, an investment bank consortium chaired by accountant William Willson.

Aston Martin once again fell into receivership at the end of 1974, prompted by emissions legislation making it harder to sell cars in the USA. The receiver sold the business in April 1975 for £1.05 million to North American businessmen Peter Sprague of National Semiconductor, Toronto hotelier, George Minden and Jeremy Turner, a London businessman.

The consortium sold Aston Martin to Pace Petroleum's Victor Gauntlett in 1981, by which point worldwide sales had shrunk to three cars per week. Gauntlett bought a 12.5% stake in Aston Martin for £500,000, with Tim Hearley of CH Industrials taking a similar share.

Gauntlett agreed to sell Hays/Pace to the Kuwait Investment Office in September 1983, and also agreed to sell his shareholding to American importer and Greek shipping tycoon Peter Livanos, who invested via his joint venture with Nick and John Papanicolaou, ALL Inc. In 1984 – the year Aston Martin built its 10,000th car – Livanos's father George bought out the Papanicolaou's shares in ALL, while Gauntlett again became a shareholder with a 25% holding in AML. The deal valued Aston Martin/AML at £2 million.

Following a chance meeting between Guantlett and Ford vice-president Walter Hayes, Ford took a share holding in the company in September 1987. Ford later took full control, and Gauntlett handed over Aston Martin's chairmanship to Hayes in 1991.

Ford placed Aston in its Premier Automotive Group, investing in new manufacturing facilities and increasing production. However, in August 2006 Ford announced t had engaged UBS AG to sell all or part of Aston Martin at auction.

On 12 March 2007, a consortium led by Prodrive chairman David Richards bought Aston Martin for £475m (US$848m). The group included American investment banker John Singers and two Kuwaiti companies, Investment Dar and Adeem Investment.

Italian private equity fund Investindustrial signed a deal on 6 December 2012 to buy 37.5% of Aston Martin, investing £150 million as a capital increase. On 2 September 2014, Aston Martin appointed Nissan executive Andy Palmer as CEO, heralding a new era of investment and expansion for the company.

In 2013, Aston Martin signed a deal with Daimler AG to supply the next generation Aston Martin cars with new Mercedes-AMG engines, with Daimler AG now owning 5% of Aston Martin.

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