Investindustrial, the Italian private equity fund, has signed a deal to buy a 37.5 per cent stake in Aston Martin, joining Kuwait’s Investment Dar, as the luxury car maker’s major investor, and seeing off competition from Mahindra & Mahindra.

Investindustrial will pay £150 million in the form of a capital increase, the Gaydon-based luxury carmaker said on Friday.

‘Investindustrial’s new investment reflects and sustains the unique position of Aston Martin within the industry,” David Richards, Chairman, Aston Martin, said in a statement.

The Italian private equity fund, which has assets of around €3 billion under management, is not a new comer to the automotive sector, having bought Ducati in 2006, following which the company underwent a restructuring programme. It sold Ducati to Volkswagen’s Audi division for an estimated €860 million earlier this year.

Unions gave news of the investment a cautious welcome, calling for further assurances on the long term future of the plant and its 1,600 strong work force, as well as details of a plan to invest up to half-a-million pounds over the next five years into new product development and expanding the dealership network globally.

Investindustrial said it hoped to work with Investment Dar and Aston Martin management to bring about the kind of “transformation and rejuvenation” it undertook with Ducati, including by expanding the range of models, and strengthening its dealership network throughout the world.

Speculation has been building over the past month about the possibility of Investment Dar bringing in a partner for the luxury carmaker it bought from Ford in 2007 as part of a consortium.

In the first nine months of this year, Aston Martin revenues fell by 19 per cent, driven by a fall in sales volumes, against the same period the year before. Last week, Moody’s placed Aston Martin’s ratings on watch for a downgrade, prompted by a “significant deterioration” in the company’s liquidity profile at the end of September.

(This article was published on December 7, 2012)
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