It was reported in the Financial Times on Saturday last week (March 17, 2007) that Aston Martin (James Bond’s favourite sports car) has been sold by Ford Motor to a consortium which is to finance the LBO (leveraged buy-out) according to strict Islamic principles. This deal appears to be the deal they don’t want you to know about, since it has hardly been reported in the mainstream media at all.
Ford Motor agreed to the sale for £479m to a consortium organised by Dave Richards, a motor racing entrepreneur.
The financing of this LBO “will be financed in an exclusively shariah-compliant way”, David Testa said, the executive director of West LB, the German bank appointed to arrange £225m of the quasi debt finance to back the LBO. It is believed that this is the first time that Islamic finance has been used in the West for an LBO. The Islamic financial focus has arisen because Investment Dar and Adeem Investment Co are two Kuwaiti groups that invest in accordance with Shari’ah principles of investment, which eschew, of course, conventional Western, capitalist-style financing arrangements.
It is said that there is a rapid growth in the Islamic finance sector, a sector which is said to have grown substantially and is said to have assets already in excess of $300bn, or approximately £155bn, worldwide. Further, it is worth noting that Western investment banks like West LB, Deutsche Bank, Citigroup, and Barclays are becoming more and more involved in Islamic finance, too.
The Financial Times went on to say that we shall have to wait and see to know whether these financiers will also ban “factors deemed to be non-Koranic” such as “martini-swilling spies to market the iconic brand”.
It should be noted that it would seem fair to say that the 'great and the good' in the world of Western finance have little realisation of the implications of their greed, or else, if they do, then they are insouciant about them. For capitalism, this really must be a step in the wrong direction. The élite in the business world seem not to realise, still less understand, that Islamic economics is not the same as Western capitalism. These two economic systems are diametrically opposed, just as Islam is diametrically opposed to Judeo-Christianity.
It is sad to say that we are sowing the seeds of our own destruction, and the people at the top are too dumb to see it!