A group of Aston Martin’s creditors has threatened legal action against the carmaker after learning that it plans to sell a portion of its branding and naming rights as part of a new debt financing package, the Financial Times reported on Monday.
The loss-making luxury carmaker had in July secured £550m (R10.45bn) in debt financing, led by funds managed by BlackRock-owned HPS Investment Partners.
The financing comprises a £450m secured term loan and a £100m delayed draw term loan, and a separate £100m permitted debt incurrence capacity.
Some existing creditors owed £1.3bn sent a “letter before action” to the debt-laden British company’s board on Sunday, warning they could seek to unwind the HPS transaction and block the disposal of certain intellectual property assets, the FT report said, without identifying these creditors.
Aston Martin and HPS could not immediately be reached for comment outside regular business hours. Reuters could not independently verify the report.
The creditors have learnt that part of the deal depends on the carmaker transferring a 50.1% stake of its non-automotive intellectual property to US brand developer Authentic Brands, the report said, citing people familiar with the matter.
The additional £100m under the HPS financing package is conditional on the branding-rights transaction taking place, according to the report. HPS is also an investor in Authentic Brands.
Aston Martin has refused to share details of its deal with HPS, leaving some creditors in the dark about the agreement, the FT report said.
Aston Martin has been grappling with cash pressures from weaker sales, US tariffs and soft demand in China, prompting the 113-year-old carmaker to pursue cost cuts and fresh funding.
Reuters
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.