Aston Martin creditors ramp up pressure on struggling carmaker

Some creditors of Aston Martin Lagonda Global Holdings have sent a legal letter to the struggling luxury automaker, the latest step in an effort to thwart a debt deal that would erode their standing. Aston Martin has been in talks with funds including BlackRock Inc.-owned HPS Investment Partners to raise additional finances. The funding would be backed by Aston Martin assets that would be placed beyond the reach of existing creditors, a maneuver known as a drop-down. The creditor letter argues that a deal of this kind, which could strip the bondholders’ collateral including intellectual property, would violate the bond documents, according to people familiar with the matter. The bond documents were drafted under New York law, said the people, who asked not to be identified because the details are private. Creditors give Aston Martin 48 hours to rule out drop-down deal The letter — which was sent on Monday and drawn up with specialists at law firm Quinn Emanuel Urquhart & Sullivan LLP — gives Aston Martin a 48-hour window to confirm they won’t push ahead with this type of transaction, the people said. It states that if the company and the board choose to carry out such a transaction without considering an alternative proposal put forward by existing creditors, there could be risks under English law, the people familiar said. The letter also emphasizes that a deal with HPS, which is a shareholder in Aston Martin’s Formula One team, would come with related-party risks and that creditors will be looking very closely into it, they said. A representative for Aston Martin declined to comment, as did a spokesperson for Quinn Emanuel. The creditors’ decision to ramp up the pressure comes after a broader group of bondholders sent a letter to the company offering to provide fresh financing if needed. They proposed broader discussions about the firm’s capital structure, but Aston Martin didn’t engage, the people said. US tariffs and weak China demand deepen Aston Martin’s cash crunch Based in Gaydon, England, Aston Martin has been hit by product delays, quality issues, weak demand in China and US tariffs. While the firm had previously relied on equity injections to plug its liquidity gap, it disclosed in April that some of its shareholders had provided 50 million British pounds ($66.9 million) of debt to bolster its cash buffers. That prompted creditors to band together, fearing the company could seek additional funding using provisions in its relatively loose bond documentation — which could ultimately leave them subordinated or otherwise disadvantaged. They tapped advisers Akin Gump and Jefferies Financial Group. The creditors include Arini Capital Management, BlackRock and Sculptor Capital Management. The group entered a cooperation agreement earlier this week — a pact binding them to act in concert in potential debt discussions with the company. The creditors include holders of the majority of Aston Martin’s $1.85 billion equivalent of bonds due in 2029. Aston Martin is owned by a consortium of investors led by Canadian billionaire Lawrence Stroll. Other shareholders include Geely’s founder Li Shufu, Saudi Arabia’s Public Investment Fund and Mercedes-Benz Group. By Giulia Morpurgo and Irene García Pérez

Aston Martin creditors ramp up pressure on struggling carmaker

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Aston Martin creditors ramp up pressure on struggling carmaker

How Bottega Veneta weaved China’s forever it bag