Aston Martin at centre of Italian-Indian bid war

MILAN/MUMBAI Mon Nov 26, 2012 3:31am GMT

1 of 2. A new V12 Zagato model car is displayed on the Aston Martin booth during the first media day of the Geneva Auto Show at the Palexpo in Geneva in this March 6, 2012 file photo. Aston Martin stands at the centre of an international takeover battle after Indian motors group Mahindra trumped an Italian bid for half of the British luxury car maker. Italian private equity fund Investindustrial reached an agreement on November 22, 2012 with the owner, Kuwaiti investment house Investment Dar, but Mahindra and Mahindra made a higher offer on November 23, 2012, leaving the fate of the 98-year old icon of British motor engineering hanging in the balance, sources familiar with the discussions said.

Credit: Reuters/Denis Balibouse/Files

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MILAN/MUMBAI (Reuters) - Aston Martin stands at the centre of an international takeover battle after Indian motors group Mahindra trumped an Italian bid for half of the British luxury car maker.

Italian private equity fund Investindustrial reached a agreement on Thursday with the owner, Kuwaiti investment house Investment Dar, but Mahindra and Mahindra (MAHM.NS) made a higher offer on Friday, leaving the fate of the 98-year old icon of British motor engineering hanging in the balance, sources familiar with the discussions said.

Aston Martin makes the cars immortalized by James Bond films down the decades in Gaydon, Warwickshire, the heartland of England's early 20th century motor manufacturing heyday.

The company was sold in 2007 by U.S.-based Ford Motor Co. (F.N) for 479 million pounds ($767 million), to Kuwait's Investment Dar and another Kuwait fund, Adeem Investment Co.

The consortium was fronted by David Richards -- former Formula 1 Benetton and BAR racing boss, who remains chairman.

Aston Martin sells approaching 15 percent of its DB9, Vanquish and other models in Asia. Wealthy Chinese buyers snapped up 110 cars in 2010 and sales are expected to have multiplied five-fold to over 500 this year.

"Talks are continuing through the weekend," said one source, who said Investindustrial had bid between 200 million and 250 million pounds ($400 million) for the stake, and is confident of winning the race because it sees its proposal as "technically" superior, including a technical partnership deal with Daimler AG's (DAIGn.DE) Mercedes.

The same source said manufacturing would stay at Gaydon under the Italian proposal.

A spokesman for Investment Dar, which went to the market for a $1 billion debt restructuring last year, was not immediately available for comment, nor could Mahindra be reached for comment. Investindustrial declined comment.

Investindustrial, owned by Italy's Bonomi family, is not new to luxury motor brands. In 2006, it bought Italian motorcycle maker Ducati and sold it for about 860 million euros last April to Volkswagen's (VOWG_p.DE) Audi division.

Mahindra is the world number one tractor make. It also makes more sport utility vehicles than any other Indian motor manufacturer, and controls South Korean car maker Ssangyong Motor Co Ltd (003620.KS).

A second source familiar with the process said Mahindra was keen to access the Aston Martin technology to upgrade its existing vehicle platform.

Another Indian motor company, Tata Motor, owns British luxury manufacturer Jaguar Land Rover, and has had even more success than Aston Martin in China, now Jaguar Land Rover's biggest market.

($1 = 0.6246 British pounds) ($1 = 0.6246 British pounds) (Writing by Andrew Callus; Additional reporting by Amran Abocar in Dubai, Rhys Jones in London, Sylvia Aloisi in Milan, Henry Foy in Mumbai, editing by William Hardy)

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Comments (1)
Spinner wrote:
God forbid that the Aston Martin brand could be in some way, no matter how far removed, related to Ssangyyyyong Motor Co Ltd, the makers of probably the world’s worse made, worst performing, and worst looking vehicles. A brand which set itself up based on a lie that it was somehow or other sponsored by Mercedes Benz.

I can just see it now – “Ssssonyyyyang – powered by Aston Martin”!

Tradition and sentimentality probably has no real place in motor vehicle production, but the Aston Martin brand thrives on it, and to run the risk of bastardisation of the brand by association with Ssssonyyyyang is just too awful to contemplate.

Cross out the Mahindra bid – please.

The other alternative is only slightly better. The Italian investment company would purchase it and enter into its “technical partnership” with Daimler Benz. That of course, translated into real language, means that Daimler Benz would contribute to the technical development of the most technically advanced passenger vehicle currently available, which can only be interpreted as ripping every bit of technical know how out of the Aston Martin brand as quickly as they can. The leftover would then be sold off, probably for a song, to the likes of VW Audi Porsche, a la Ducati.

Whichever way it goes, it looks llike the Kuwaiti investors have brought about the undoing of the Aston Martin marque.

Well done Kuwait. You must now realise that Aston Martin was not a breed of camel.

Nov 26, 2012 3:21am GMT  --  Report as abuse
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