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Aston Martin is keeping investors in the dark over the structure of a contentious £550mn debt deal that shifts assets out of the reach of existing creditors in favour of its new lender, the BlackRock-owned private credit firm HPS.
The cash-strapped carmaker announced the funding package last week, comprising a £450mn term loan and a further £100mn that can be drawn in the future.
Aston Martin said the new HPS financing was “secured against certain of the Group’s assets situated in a newly incorporated subsidiary, together with certain other assets”.
The move was challenged by existing creditors, who argued that a financing deal placing those assets beyond their reach breached key terms of Aston Martin’s existing debt.
The carmaker has fielded questions from a group of existing lenders, owed more than £1.3bn, as well as equity analysts on its earnings call on Wednesday. Both groups have sought to understand what assets have been pledged as collateral to HPS.
Aston Martin, which has publicly traded equity and debt, refused to reveal the details on the call and defended the deal as “important for the company as a whole”.
While bondholders have asked that the company disclose what assets have been shifted out of their pool of collateral, Aston Martin has not agreed to do so, according to people familiar with the matter.
A person close to Aston Martin said the company was in full compliance with disclosure obligations.
The refusal has heightened tensions between the company and its lenders, and shocked credit investors throughout the market.
“It’s completely ludicrous . . . I’ve never seen anything like it,” said one high-yield portfolio manager, who does not own Aston Martin debt. “It’s going to piss off a lot of the market.”
Specifically, investors are keen to understand whether the company’s valuable intellectual property assets have been designated as “unrestricted” and pledged to HPS, placing them out of existing creditors’ reach.
Another asset under scrutiny is Aston Martin’s plant in Wales, which opened in 2019 with financial support from the Welsh government but has operated well below its full capacity.
“All the information relating to the transaction we’ve set out in our prior announcements, so nothing further to disclose today,” finance chief Doug Lafferty said on Wednesday in response to an analyst’s question about the shifted assets.
The new financing has been used to repay a £170mn revolving credit facility, as well as a portion of another £50mn facility extended by a consortium backed by chair Lawrence Stroll.
Earlier this year, Aston Martin also announced plans to raise £50mn by selling the rights to use its name for the Formula 1 racing team. The sale of branding rights to the F1 team’s holding company, AMR GP Holdings, in effect marked a cash injection from Stroll, who indirectly controls AMR.
HPS has a minority stake in AMR GP Holdings that it acquired in 2024.
In addition to the lack of transparency, some investors have questioned whether recent financing deals have benefited certain shareholders such as Stroll.
The £50mn deal, for example, was criticised by existing shareholders who questioned the valuation as too low considering that Stroll had secured perpetual rights to use Aston Martin for the racing name.
Aston Martin declined to comment.
