Indian manufacturer Mahindra has bought Italian design house and coachbuilder Pininfarina in a deal worth a reported €168 million (about £122 million).
The deal involves Mahindra purchasing a controlling interest of 76.06% in Pininfarina. An open offer for the remaining shares will be issued later. Pininfarina will continue to remain an independent company, with Paolo Pininfarina continuing at the head of its board.
Mahindra will also invest €20 million into Pininfarina and provide a guarantee to creditors of €114.5 million.
Speaking at the announcement, Mahindra boss Anand Mahindra said: "The legendary high-end design credentials of Pininfarina will significantly enhance the design capabilities of the entire Mahindra group. Given the increasing design sensibilities of today's consumers, product design will greatly influence customer choice."
It's understood that the deal is intended to give Mahindra more of an international footing and forge relationships with more European manufacturers through Pininfarina's connections. In return, Pininfarina will have access to greater economies of scale, bringing down the costs of manufacturing.
The Pininfarina deal is the latest acquisition by Mahindra, following its takeover of Ssangyong and PSA Peugeot Citroen's motorcycle unit.
Pininfarina had been operating at a loss for some years and had racked up a debt of €52.7 million (£37m). Negotiations between Pininfarina’s creditor banks, main Pininfarina shareholder Pincar and Mahindra have culminated in the deal.
Paolo Pininfarina said: "In a globalised world, entrepreneurship and capital do not need a passport. Being part of the global Mahindra group will not only strengthen our Italian identity but will also open more doors."
Pininfarina was founded in 1930 and has designed most famously for Ferrari, but also for Maserati, Rolls-Royce, Alfa Romeo, Lancia and others, as well as recently redesigning Eurostar's trains. In spite of its widespread work, it was arguably the design house’s intrinsic connection with Ferrari that cemented its name in the car design hall of fame and made it a household name.
Having designed around 100 Ferrari models, founder Sergio Pininfarina’s death in 2012 prompted the design house to commission a one-off, Ferrari 458 Spider-based model called the Pininfarina Sergio. It also marking 60 years of Pininfarina’s relationship with Ferrari. The Pininfarina Sergio was revealed at the Geneva motor show in 2013 and featured at the Geneva show in 2015, after being signed off for a limited production run of six units.