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Billionaire pair eye Aston Martin |
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Saturday, 21 October 2006 |
BERNARD Arnault and Albert Frere, two of Europe's most prominent billionaires, are considering a bid for Aston Martin, the British luxury sports car maker that has been put up for sale by Ford Motor.
Mr Arnault, 57, is the chairman, chief executive and controlling shareholder of LVMH, the Paris-based luxury goods multinational that includes Louis Vuitton and Fendi among its brands. He is France's richest man.
Mr Frere, 80, chairs Groupe Bruxelles Lambert, the listed Belgian investment company that owns big stakes in Total, the oil group, and Lafarge, the cement maker.
The pair are close friends and already jointly own the prestigious Chateau Cheval Blanc winery in Bordeaux, which they bought in 1998.
The two billionaires announced that they were formally joining forces to create a joint investment structure involving Groupe Arnault, which is owned by Mr Arnault, and the Frere-controlled NPM/CNP.
"They are looking at Aston Martin," a source said.
"It falls within the scope of their investment fund."
Another source said any bid for Aston Martin could be made through the new structure, adding that such an offer would probably be worth more than E1 billion ($1.66 billion).
Ford took a controlling stake in Aston Martin in 1987, but the troubled US car maker has recently decided to sell the marque - famed for its use in James Bond films - as part of a broad restructuring.
UBS, the investment bank running the auction, has sent out a preliminary information memorandum to prospective bidders. It is shortly expected to draw up a list of those it considers serious.
The newly formalised collaboration between Mr Frere and Mr Arnault will be able to draw on an equity financing capacity of E1 billion. By borrowing money, the private investment vehicle could increase its financial firepower to E4 billion-E5 billion.
It is becoming more common for wealthy individuals to adopt tactics typically employed by private equity groups. These include Philip Green, the UK retail entrepreneur, Ron Perelman, the US financier, and Naguib Sawiris, the Egyptian telecommunications investor.
In a press release announcing their joint investment plan, Mr Frere and Mr Arnault said the new partnership would take stakes mainly in European companies.
They added that several projects were already being studied, without giving further details.
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Last Updated ( Saturday, 21 October 2006 )
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