Aston Martin Lagonda Ltd is seeking a valuation that could top its only listed rival, Ferrari NV.
The maker of luxury sports cars made famous in the James Bond movies yesterday filed for an initial public offering (IPO) in London that would value the UK company at up to ￡5.07 billion (US$6.7 billion).
That would surpass the multiples of Ferrari, which makes more profit and churns out oodles of cash.
The valuation is “a big vote of confidence,” CEO Andy Palmer said in an interview, adding that the company was worth less than one-tenth its current value when the turnaround started.
“Most important from my point of view is that we are only halfway down the runway. We renewed the existing portfolio and we have a lot in front of us,” he said.
The company’s first sport utility vehicle (SUV) is coming out in 2020, giving it access to the Chinese market and a head start over Ferrari, which this week postponed its Purosangue SUV to 2022, Palmer said.
Luxury carmakers are crowding into SUVs to capture high profit margins that will fund initiatives such as electrification.
Based on its first-half earnings, Aston Martin could be valued at more than 24 times adjusted profit before interest, tax, depreciation and amortization (EBITDA), a calculation that does not take into account Aston Martin’s debt and research-and-development expenditure — which would push the multiple higher.
Ferrari trades at about 20.5 times its expected adjusted EBITDA for this year, based on Bloomberg data — a figure that is closer to luxury good companies than to carmakers.
However, analysts are skeptical that Aston Martin’s business can command a valuation like Ferrari’s.
“We love the brand. We respect the management team. But we simply can’t see how a Ferrari multiple looks realistic,” Sanford C. Bernstein & Co analyst Max Warburton said in a research note. “They are selling a business that is loss-making on a US GAAP basis, with a weak profitability record and a fragile balance sheet, selling cars at much lower price points, to a much less dedicated audience.”
The UK carmaker is to sell a 25 percent stake at between ￡17.50 and ￡22.50 per share, it said in a statement.
Trading is to begin on the London Stock Exchange about Oct. 8 after an Oct. 3 pricing.
Even at the bottom of the targeted range, which would value the firm at about ￡4.02 billion, Aston Martin’s owners would be making multiples on their investment.
In 2012, when London-based Investindustrial Advisors Ltd bought a 37.5 percent stake, the company was valued at about ￡420 million, Palmer said.
Daimler AG is to convert its holding of about 4.9 percent to ordinary shares.
Aston Martin shareholders are cashing out months before the UK leaves the EU.
While the UK’s post-Brexit auto industry is one of the sectors most exposed to potential trade hurdles, the company is “well insulated” in the case talks break down and Britain leaves the bloc without a trade deal, Palmer said.
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
Merida Industry Co (美利達) has seen signs of recovery in the US and European markets this year, as customers are gradually depleting their inventories, the bicycle maker told shareholders yesterday. Given robust growth in new orders at its Taiwanese factory, coupled with its subsidiaries’ improving performance, Merida said it remains confident about the bicycle market’s prospects and expects steady growth in its core business this year. CAUTION ON CHINA However, the company must handle the Chinese market with great caution, as sales of road bikes there have declined significantly, affecting its revenue and profitability, Merida said in a statement, adding that it would
UNCERTAINTIES: The world’s biggest chip packager and tester is closely monitoring the US’ tariff policy before making any capacity adjustments, a company official said ASE Technology Holding Inc (日月光投控), the world’s biggest chip packager and tester, yesterday said it is cautiously evaluating new advanced packaging capacity expansion in the US in response to customers’ requests amid uncertainties about the US’ tariff policy. Compared with its semiconductor peers, ASE has been relatively prudent about building new capacity in the US. However, the company is adjusting its global manufacturing footprint expansion after US President Donald Trump announced “reciprocal” tariffs in April, and new import duties targeting semiconductors and other items that are vital to national security. ASE subsidiary Siliconware Precision Industries Co (SPIL, 矽品精密) is participating in Nvidia
RSS