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Directors’ Deals: Aston Martin shares head east 

Chinese automotive giant Zhejiang Geely Holding Group’s plan to build closer ties with Aston Martin Lagonda is the latest in a series of wins for by the luxury carmaker, whose shares have trebled in value over the past eight months.

The outperformance of the Aston Martin-branded Formula One team, which unexpectedly stands in second place in the constructors’ rankings, has also given a welcome boost to the company’s brand. 

Geely, which first invested in Aston Martin via its £653mn capital raise in September last year, has just become the company’s third-biggest shareholder, behind chair Lawrence Stroll’s Yew Tree Consortium and Saudi Arabia’s Public Investment Fund. The Chinese automaker has just laid out £234mn, increasing its stake from 6.5 per cent to 17 per cent. About £140mn of this has been spent buying out existing shareholders — Stroll’s consortium sold £117mn worth of shares, and non-executive Michael de Picciotto sold £7.8mn-worth. 

The other £94mn is being invested through a subscription to newly issued shares, which provides Aston Martin with a further cash injection and expands its share base by 4 per cent. 

This takes the money raised through share sales to more than £1.6bn in less than five years. 

Yet the fact that Aston Martin continues to burn through cash as quickly as one of its high-performance cars gets through fuel explains why, despite recent gains, the company’s shares still trade 86 per cent below their October 2018 float price of 1,900p a share. 

Until it can put the brakes on this, investors will remain unimpressed by talk of “joint technology synergies”.

Turkish investor ups Genel Energy stake

It’s been almost three months since the oil pipeline between Iraq and Turkey shut down. 

Two UK-listed Kurdish oil producers, Genel Energy and Gulf Keystone Petroleum are stuck in limbo as a result, given that they don’t have enough storage to keep wells pumping without that export capability. 

There are occasional bursts of optimism about a quick reopening of the pipeline — the most recent being Iraq’s oil minister who said that talks were both taking place and that he was hoping to welcome a Turkish delegate for talks soon, confusingly — but no major breakthroughs. The Turkish government shut down the Kirkuk—Ceyhan pipeline after losing an arbitration case brought by the Iraq government. The two Turkish presidential votes in May put a pause on negotiations, while another arbitration case about the same issue is still in play and could yet provide more barriers to reopening the 450,000 barrels of oil per day (bopd) pipeline. 

The share prices of Genel and Gulf Keystone have been resilient despite the potential for the stoppage to continue indefinitely. Genel is flat on its pre-March 23 share price, while Gulf Keystone (which had to stop producing more quickly) is down by around a quarter. 

Genel boss Paul Weir said last month the company had scaled back its spending, but remained in a “robust” cash position, with $496mn (£399mn) in the bank. 

Share purchases by non-executive director Tolga Bilgin reflect that confidence — his company, Bilgin Energy, bought almost £1.5mn in shares in Genel last week. The latter did not give a specific reason for the transactions, which were split over four trading sessions. Bilgin Energy’s stake is now close to 23 per cent. 

Bilgin is a Turkish company with gas and renewables assets, as well as an energy investment business.

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