Indian car manufacturer Mahindra is planning to buy a 76 per cent stake in the Italian design house.
With an offer to buy a 76 per cent stake in the Pininfarina, India’s largest car manufacturer, Mahindra is set to take control of the iconic Italian design house. The deal is set to cost around €168m.
The actual purchase of Pininfarina is said to be worth around €25m, but the real cost will come with settling the large debt that comes along with the business. Mahindra has also offered to buy up remaining shares on the Milan Stock Exchange for €1.10 per share.
Mahindra might not be one of the best-known motor manufacturers in Europe, but it’s one of the biggest in its home market. Indian billionaire Anand Mahindra is behind many of the company’s recent purchases, including the $460m buyout of South Korean SSangyong Motor in 2010, but this deal represents one of the largest European transactions in the company’s history.
Like other Italian design and coachbuild specialists Italdesign, Bertone and Zagato, Pininfarina has been struggling financially for some time, and it’s hoped that this buyout has secured a future for Pininfarina.
Despite its new ownership, Pininfarina claims that its ongoing relationships with other manufacturers (most notably Ferrari) will not be affected. It’s likely that Mahindra will utilise Pininfarina’s vast experience in producing attractive and desirable cars for the European and US markets – something the company (G-Wiz electric quadricycle and SSangyong recent range of SUVs aside) has so far not managed to do.
It has been confirmed that Paolo Pininfarina, grandson of the company founder, will continue running the company. In the Short term, Mahindra has announced that it will invest $20m into Pininfarina.