Paolo Pininfarina, chairman, Pininfarina S.p.A. added, “In a globalised world, entrepreneurship and capital do not need a passport”.
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In the first leg, the SPV will acquire 76.06 per cent for €25.3 million in cash from its promoter Pincar.
Founded in 1930, Pininfarina has designed vehicles for marquee automobile manufacturers including Ferrari, Alfa Romeo, Peugeot, Maserati, and Rolls Royce.
Apart from this, Mahindra will also make a offer to the remaining public share holders to buy the remaining 33 million euros ($36 million). The company also noted Pininfarina’s focus on design and the company’s presence in key markets such as China, Italy, Germany, and the United States.
Tech Mahindra will be largely benefited by this deal as the design company will provide a whole new dimension to design of future Mahindra products.
The group, led by chairman and managing director Anand Mahindra, has made several bold acquisitions in the past, including the $580 million buyout of scandal-tainted Satyam Computer Services in 2009.
The acquisition illustrates the global ambitions of Mahindra and Mahindra, which acquired controlling stakes in Ssangyong in 2011 and PSA Peugeot Citroen’s motorcycle unit early this year.
Mahindra and Pininfarina have been in talks to strike a deal on this matter for sometime now.
“The SPV will also infuse an amount of Euro 20 million into Pininfarina by way of a rights issue”, the company said, adding the fund infusion into the design and styling major will be executed before the end of 2016.
“This (acquisition) will mean an opportunity for Tech Mahindra to influence product conceptualisation and design and styling through Europe’s best-in-class design house”, the joint statement said.
Indian conglomerate Mahindra Group has purchased floundering auto designer Pininfarina, paying $28 million for the Italian firm that dreamed up many of Ferrari’s most legendary cars. However, investors seem not too enthused about the development as M&M shares were up 0.6 percent on the BSE and those of Tech Mahindra were down 1.5 percent.
Pininfarina Spa, Chairman Paolo Pininfarina said joining hands with Mahindra Group will not only strengthen Pininfarina’s Italian identity but will open more doors.
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The Italian company has been losing money for years, partly because automakers have brought design in-house rather than hire independent design firms.
