Indian technology company Tech Mahindra and carmaker Mahindra & Mahindra have jointly agreed to purchase a controlling stake in Pininfarina. The move was rumoured earlier this year, and looked to have stalled over the summer, but the announcement securing the design house's future was officially confirmed today.
Under the terms of the agreement, Tech Mahindra and Mahindra & Mahindra will buy 76.06 percent of Pininfarina shares from Pincar S.r.l for €25.3million. The two firms will own 60 and 40 percent of the controlling shares respectively, while the remaining shares will be sold to investors in 2016.
As part of the deal, the new owners will invest €20million in Pininfarina, which will remain an independent company, listed on the Milan Stock Exchange, and Paolo Pininfarina will continue as the chairman of its board. Importantly, the new deal also means a fund of €114.5million will be guaranteed to the holders of Pininfarina's substantial debts.
Talking about the new deal, Paolo Pininfarina, said "We are joining hands with a $3.9billion technology partner, which will not only strengthen our Italian identity but will open more doors. Tech Mahindra's global presence and global delivery model will allow us to compete for a larger pie of the business."
Pininfarina has already worked with Mahindra & Mahindra on the design of its SUVs, and that connection is only expected to broaden with the new deal now in place.
Tech Mahindra has confirmed that it has taken a majority stake in Pininfarina to gain a better foothold in Europe, the US and China, taking advantage of the client base the Italian firm has developed over its 85-year history.
In return, Pininfarina will be able to work with Tech Mahindra's 780 customers spread across 90 countries, increasing its scale and reach. Mahindra also plans to develop Pininfarina's 25-year-old non-automotive design business, and will use the Italian firm to develop projects involving aerospace, consumer electronics, architecture and interior design.