As significant investors, notably Saudi Arabia’s national wealth fund, continue to believe in the struggling luxury British carmaker, Aston Martin, the company is raising 575.8 million pounds ($660 million) through a rights offer.
The 109-year-old business said on Monday that it would issue four more shares at a price of 103 pence each for each existing share. The stock was down 10% to 432.9 pence at 0750 GMT.
Saudi Arabia’s Public Investment Fund (PIF), one of the company’s top shareholders, would raise 653.8 million pounds in equity as a result of the rights issue, which was part of an earlier announcement.
Aston Martin claimed that PIF, chairman Lawrence Stroll’s Yew Tree, Mercedes Benz, and the rights issuance were all fully committed and underwritten.
According to the company, the fundraising will enable it to pay down debt and invest in new models.
The owner of a Formula One racing team has been spending money quickly and experiencing supply chain problems. In July, it reported a tripling of its pretax half-year losses.
The corporation turned down a 1.3 billion pound investment proposal that would have given Chinese automaker Geely and Italian investor Investindustrial ownership of the company that month.
Whether regard to the issues in the first half, Victoria Scholar, head of investment at interactive investor, stated that “Aston Martin’s fundamentals remain fragile with or without the capital raise.”
She claimed that the recent drop in the value of the pound would spark interest from a foreign bidder.
