The Ford Motor Co. is selling its British luxury unit Aston Martin to a group led by David Richards, the former Benetton and BAR motor racing entrepreneur. The sales transaction would involve a whooping $925 million or 479 million pounds.
The automaker said last Monday that it would retain a 40 million pound investment in the Aston Martin. The unit, headquartered at Gaydon, Warwickshire, England, is famed for its luxury performance. But the popularity is heightened by James Bond movies where the models of the units are featured.
The unit's name is based from the combination of Clinton hill climb and one of the company's founders named Lionel Martin. The unit became part of the Premier Automotive Group which is a division of Ford Motor Co. back in 1994. But the unit was put up for sale in August last year. On the 12th of this month, the unit was purchased by the British consortium. The deal though is expected to close in the second quarter of this year.
According to the sources familiar to the deal, Richards, the founder and chairman of Prodrive motor-sport and engineering, will be backed by Kuwait's Investment Dar and Adeem Investment Co, and John Sinders, a banker in finance and shipping from Dubai, Houston, and Texas. Richards will join the Aston Martin board as non-executive chairman.
Ford was earlier quoted saying that it was considering the sale of Aston Martin to free funds to invest in its other brands amid a sharp downturn in sales. It could be noted that the second largest automaker in the United States has posted its biggest loss last year. For the first time in its 103-year existence in the auto industry, the automaker let the $12.7 billion into the red. The loss is basically attributed to the soaring fuel prices and interest rates. This situation drove consumers away from the sport utility vehicle and truck segments, which usually are accounted for most profits.
Ford, in the early stage of its four-year turnaround plan, decided to close 16 plants and cut up to 45,000 jobs. "The sale of Aston Martin supports the key objectives of the company, to restructure to operate profitably at lower volumes and changed model mix and to speed the development of new products," Ford President and Chief Executive Officer Alan Mulally said in a statement. He added, "From Aston Martin's point of view, the sale will provide access to additional capital, which will allow Aston Martin to continue the growth it has experienced under Ford's stewardship."
The Aston Martin name became an instant star in the 1964 James Bond film "Goldfinger", with Sean Connery swapping his Bentley for a gadget-laden DB5. The car is equipped with powerful parts that ejector seat, rockets and a retractable armored shield and that sure is far beyond the offerings of a or a Land Rover engine.
Daniel Craig was behind the DBS in the latest James Bond film titles "Casino Royale." The Transport and General Workers Union (T&G), which represents Aston Martin workers, said that the criteria for the sale should be to keep manufacturing in Britain and maximize jobs. "The bid from Prodrive appears to best meet our criterion which is why we're looking forward to meeting with them at the earliest opportunity," said Dave Osborne, the T&G national secretary for the car industry, said in a statement. "This is a good business with a skilled workforce and a new leadership with a background in the industry."
The automaker said in January that Aston Martin was on a solid financial footing and had increased sales by around a half last year to about 6,500 units.
