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Agree. There are so many bargains on the LSE because pension and insurance fund managers are pencil pushing bureaucrats with no sense of risk and are always looking in the rear view mirror. All good for bargain hunting but short term price formation ruled by these idiots, so patience required. As we AML holders have learned
I think the LS end game is sale to a luxury conglomerate - LVMH, Kering, Richemont, Ralph Lauren. Make cars profitably then focus on brand extension. Massive. For them it's petty cash even at £10 a share, and broadens their diversification. Win Win
"You know that moment when you emerge from a side road hoping to join a queue of traffic only to realise that, no matter how sweetly you smile, no one is going to let you out? It’s hard enough to appeal to your fellow driver’s good nature if you’re driving a battered Vauxhall Corsa, but if you’re in a gleaming supercar that does 14mpg with a private number plate and a carbon body pack, you may as well just switch the engine off and check your food supplies. ...There is one strange exception, though. In an Aston Martin, I've experienced drivers almost eager to offer up space"
This is so true and so valuable. AM is a brand that is innately loved, quite unlike almost any other. Ferrari is revered, of course, due to the monomaniacal nature of its creator but AM inspires affection due to its erratic history, its Brummie roots and its essential Britishness. Stroll is doing all the right things to make it more widely known without losing its charm. Stroll Jr's redemptive drive in LV can add to that. It's part of AMs eccentricity for the team to bought to give his son an F1 seat, then he turns out to be not half bad. Even bringing disastrous upgrades then ditching them adds to the story. The value of being a bona fide F1 challenger is huge. Look how GM Audi Honda begging to get in. By the time next LV F1 comes round AM will be free cash flow +ve, its interest costs post refinancing down 60% in two years and its new models all on waitlist, what price AML shares?
An NVDA investor suffered a 62% loss in the 12 months to October 2022. Sometimes, you just have to suck it up.
Sterling has been weak
I would also note that in 21 and 22 interest payments were £171m, in 2023 £120m and in 2024, without refinancing, they will be £70m, an EBITDA coverage of 3x or greater.
I don't take the share price as a lead indicator of company fortunes. I look at cash flow.
Redeeming = repaying = reducing
OTOH you could bother to read the announcement. The cash raise and use of proceeds are detailed clearly under Financial Highlights and Balance Sheet and then you would know exactly what's going on and why.
Refinancing = Replacement of old debt with cheaper new debt
Refinancing NOT = Repayment of debt from share issue.
£100m of 15% second lien repaid next month bringing debt down to £650m.
£550m of 10% senior unsecured likely can be refinanced two points cheaper, balance of £100m 15% second lien.
We are looking at halving interest costs from £120m in 2023.
Https://www.skysports.com/f1/news/12433/12986173/trent-alexander-arnold-rory-mcilroy-anthony-joshua-join-investors-in-alpines-formula-1-team
So if Alpine F1 sells a minority interest at €900m valuation, talk about AM selling its team for $800m has to be wildly underestimating its current value. IMO it's improbable they are planning to but it's just another example of how the "chat" about AM has no conception of its true worth.
If Invesco under 5%, no requirement to RNS. I notice we only have RNS for 10m out of 26m share purchase. If, I speculate, there's some kind of VWAP agreement between Stroll and Invesco, Stroll has an interest in keeping the price down till it closes. Just saying.
Stroll says Geely has also increased its stake, but that news has yet to hit the wires...
A new fund manager has one shot to clear the slate, after which it's his problem. AML likely a blemish on previous manager's record, hence the change, and no way the new one wants continuity of failure. If doesn't matter what he thinks of AML, from his perspective it's damaged goods. Sell. Move on. Very possibly similar situation at other IM companies, hence others are selling into the weak market. So it goes. Suck it up. Either you believe Stroll or you don't and very soon the only remaining holders will be true believers. At which point, onward and upward, but right now it's about clearing out the stale bulls
Aston Martin Chairman Stroll Raised Stake After Investor Sought Sale https://www.bloomberg.com/news/articles/2023-10-04/aston-martin-s-stroll-raised-stake-after-investor-sought-sale
Now we know. Invesco was the seller due to change of fund manager. Generally market is in bad shape and likely other fund managers seeing outflows and being forced to sell. It is by no means the only mid-cap cratering on small volume
I'm imagining a block trade from an investment company / hedge fund, not identified as below 5%. Remaining 16450000 still to come. I imagine also Geely would have been given the option to participate and chose not to. It's an ugly market altogether, even more so in China, so not a lot of buyers out there.
Yes. Tight lipped no comment.
Are you sure it's not the other way round: Geely's undertaking to Yew tree?
No way is there a TO in the offing. Stroll has spent three years getting the debt under control, last thing he wants is to crank up the leverage and be beholden to the banks for the next few years. Silly of AJBell to speculate. Stroll's move is bullish enough without it.
Sometimes, maybe we should take things at face value. The RNS implies that the 26m will come from purchases in the open market. It won't be new shares nor from other strategic shareholders or it would say so. There is no dilution nor is anyone reducing.
I believe the warrants were deeply out of the money and, again, if they are being exercised the RNS would say so.
So far this year Geely have bought at 335, Lucid at 351, and everyone at 371. Though Yew tree sold to Geely, they only sold the stock that they had purchased last October.
Stroll is simply demonstrating confidence to his partners and to the world.
This month's sell off is similar to many other mid sized stocks on the LSE: heavy falls on small volume. It's not a mystery. In fact just another indication of the miserable state of the LSE and the UK institutional mindset.
IOW it's all good.