Indian manufacturer Mahindra & Mahindra has agreed to buy out Italian design house and coachbuilder Pininfarina in a deal worth about 168 million euros ($185 million).
As part of the agreement, Tech Mahindra and M&M shall purchase 76.06 per cent of Pininfarina shares from the current controlling shareholder Pincar S.r.l. at a price of 1.1 euro per share. This investment by Tech Mahindra and M&M will be done via a joint venture company (JVCo), where ownership will be held 60 per cent by Tech Mahindra and 40 per cent by M&M. This will be followed by an open offer for all the remaining ordinary shares of Pininfarina, at the same purchase price paid for the those held by Pincar. A rights issue to infuse funds into the design and styling major will also be executed before the end of 2016. Pininfarina will continue to remain an independent company, listed on the Milan Stock Exchange, with Paolo Pininfarina continuing as the Chairman of its board.
Anand Mahindra, Chairman of the Mahindra Group, commenting on Pininfarina joining the Mahindra family, said, "Pininfarina will add enormous value to Tech Mahindra's portfolio of engineering services. But just as important is the fact that 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 and experience, and hence our success”.
Speaking about the acquisition, CP Gurnani, CEO & Managing Director, Tech Mahindra said, "Our clients want more from us, consistently. Adding Pininfarina's legendary design skills to our Integrated Engineering Solutions enables a strong entry into automotive styling, design & development and reinforces our body engineering capabilities. Further, Pininfarina's 25-year design expertise in industries beyond automotive will give us that winning edge in areas such as Aerospace, Consumer Electronics, Architecture & Interiors and Transportation where we already have a strong footprint."
Pininfarina was founded in 1930 and has designed most famously for Ferrari, as well as Maserati, Rolls-Royce, Alfa Romeo, Lancia and others, and most recently for redesigning Eurostar's trains.
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, named Pininfarina Sergio. It also marked 60 years of Pininfarina’s relationship with Ferrari. The model 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.