Tech Mahindra, along with its parent Mahindra & Mahindra, has signed a deal with Pincar Srl to acquire a controlling stake in Pininfarina SpA, an Italian automotive brand and industrial designer, for about €33.5 million (₹248 crore).
Formed in 1930, Pininfarina was contracted by brands such as BMW, Ferrari, Alfa Romeo, Peugeot, Fiat, GM, Lancia and Maserati. Since 1980, the company has designed high-speed trains, buses, trams, airplanes and private jets.
Open offerThe acquisition, to be executed through a special purpose vehicle, will buy 76.06 per cent stake from the promoters at €25.3 million, at a price of €1.1 a share. Tech Mahindra will invest 60 per cent while M&M will infuse the remaining capital.
The SPV will also make an open offer to acquire an additional 23.94 per cent at €1.1 a share from shareholders of Pininfarina, said the press statement of the company.
Once under the belt, the SPV will infuse €20 million into Pininfarina by way of rights issue. As part of the composite deal, both Tech Mahindra and M&M will sign a corporate guarantee of about €114.5 million to the lenders, creditors, and lessors of Pininfarina. Both the companies will also work with lenders to restructure the debt on books.
In 2014, revenue of the company was €86.6 million and EBITDA was €7 million. Currently, it employs 650 people. The company will operate as an independent entity, led by present chairman Paolo Pininfarina and remain listed on the Milan Stock Exchange, said Tech Mahindra in a statement.
Anand Mahindra, Chairman of Mahindra Group, said given the increasing design sensibilities of consumers, Pininfarina will play a key role in product design.