Billionaire Lawrence Stroll takes stake in ailing carmaker Aston Martin

Canadian billionaire Lawrence Stroll will take a roughly 20per cent stake in Aston Martin for nearly 200 million pounds (US$263 million) as the ailing carmaker raises funds to turn around a poor performance hit by weaker-than-expected sales.

LONDON: Canadian billionaire Lawrence Stroll will take an up to 20per cent stake in Aston Martin for nearly 200 million pounds (US$263 million) as the ailing carmaker raises funds after a sales drop put pressure on its finances.

Famed for being fictional secret agent James Bond's car of choice, the 107-year old company's share price has plummeted since floating in October 2018 and it has come late to the lucrative sport utility vehicle (SUV) market which boosted rivals.

The company will raise a total of 500 million pounds, including a rights issue from existing major shareholders, it said on Friday, as it begins building its first SUV.

Aston had also held talks with Chinese carmaker Geely , a source has previously told Reuters.

Chief Executive Andy Palmer said Stroll and the consortium he will lead bring several benefits to the automaker.

"He brings with him his experiences and access to his Formula 1 team," Palmer told Reuters.

"We've talked a lot in the past few years about wanting to be clearly rooted in luxury and obviously Mr Stroll knows an awful lot about luxury."

Stroll, who made his money through investing in fashion brands such as Tommy Hilfiger and Michael Kors, has been involved in Formula One and motor racing for years and also owns Canada's Mont Tremblant circuit in Quebec.

Under Friday's agreement, Aston Martin said Stroll's Racing Point will become the Aston Martin F1 works team from the 2021 season.

Stroll will join the board as executive chairman, replacing Penny Hughes, who will step down.

(Reporting by Costas Pitas; editing by James Davey)