Click it and Unblock the Notifications
Mahindra In The Hunt For Aston Martin
Will Aston Martin become yet another Indian owned iconic British car brand? According to reports coming in, the Kuwaiti owners of Aston Martin have approached several potential buyers to sell their majority stake in the company. Aston Martin, more famous for being James Bond's car might soon have an Indian super hero driving it.
Investment Dar, which owns about 64% in Aston Martin is said to be in financial trouble and needs cash to rectify its issues. The firm has appointed Rothschild to advice it on the sale. According to reports, private negotiations are being held with potential buyers since several months.
Several months to clinch a deal might appear long for some people, but Investment Dar is looking to Sell Aston Martin for the price it bought it for five years ago. Investment Dar had paid about 800 million for its stake in 2007. The money in Indian Rupees is equivalent to Rs.4,400 crores.
There has been no official confirmation about Aston Martin's sale either from the carmaker or from its owner. Both companies have denied any plans to sell Aston Martin. But, people familiar with Investment Dar's debts have said the Kuwaiti company is in need of cash and selling Aston Martin is one of the few ways of getting it.
Mahindra can be one of the possible buyers of Aston Martin. In case Mahindra is seriously considering buying Aston Martin, the one question it needs to answer itself is what will it gain by doing it. Apart from the brand identity of being the owner of an iconic British sports car brand, Mahindra does not have much to gain in terms of technology or know how considering it is a SUV specialist.
If one would compare Tata Motors buying Jaguar Land Rover with the possibility of Mahindra buying Aston Martin, there is a huge difference. Both Jaguar and Land Rover have bigger sales volumes and had the potential to deliver profits even during the recession in Europe. Aston Martin on the other hand sells just over 4,00 cars a year. It is a niche carmaker in need of a automobile parent company that can bank roll the investments needed to develop new sports cars in the face of competition from Ferrari, Porsche and Lamborghini.
While Porsche and Lamborghini are part of the huge Volkswagen AG group, Ferrari is part of the Fiat Group. Aston Martin has no such backing and if Mahindra does end up buying the company, it has to be prepared to make considerable investments that might be even more than the Rs.4,400 crores needed to buy a majority stake in the British sports car brand.
Continue with Google