India’s Mahindra set to buy Pininfarina
India’s Mahindra Motors, famous for making sports utility vehicles and other more utilitarian offerings, is said to be close to buying Italian design house Pininfarina, which is famous for its 60-year association with Ferrari, along with the likes of Maserati, Alfa Romeo and BMW.
The Indian company is said to be set to gain the backing of Pininfarina’s controlling shareholder, Pincar, which owns 76% of the group that has designed some of the most famous Ferrari’s. However, the creditor banks would still need to sanction the deal.
Pininfarina has a market value of some €163 million but is debt-laden and close to collapse. When rumours of the takeover began to surface, the share value rose some 40%; but as of this time, Mahindra has stated that it has yet to enter into an agreement that would have a material impact on the group and Pininfarina has declined to comment.
Pininfarina recently celebrated 85 years in business and showcased the Ferrari Sergio Roadster (pic above) at the 2015 Geneva Motor Show. Set up in 1930 in Turin, Italy, which is still where its main base is located, Pininfarina has been unprofitable for the past decade and in fact had already closed the division that builds cars for other manufacturers.
While other potential bidders have expressed interest in buying the creator of the Ferrari California T Roadster, Rolls-Royce Camargue, Cadillac Allante and Maserati Quattroporte, Mahindra is favored by the Pininfarina family and its creditor banks because the Indian company is seen as capable of providing stability through its position in the auto industry. Negotiations are continuing and could still fall apart.
Pininfarina has already worked with Mahindra on the design of the new U301 compact SUV – a design that is still under wraps – and this purchase will not be the first foray by Mahindra into the overseas auto-making market. Mahindra is a well-respected manufacturer in its home country of India, but is fairly unknown outside of it. Recently, the manufacturer has started to look overseas for expansion and seems to be intent on buying up existing businesses; already it has bought controlling stakes in Ssangyong in 2011 and PSA Peugeot Citroen’s motorcycle unit earlier this year, so Pininfarina could be just the next acquisition in the company’s global march.
The takeover of Pininfarina will not be the last overseas conquest by an Asian investor; this follows China National Chemical’s €7.3 billion deal to buy into tyre maker Pirelli last month. For motoring purists out there who may groan and moan as yet another iconic company is taken over by some tractor-making ‘up-start’, they perhaps should look at the amazing turnaround made over in Coventry at the Jaguar factory, a company that is in the process of trying to punch a few Germans on the nose; and also recall that both Porsche and Lamborghini once made tractors.