Mahindra Agrees to Acquire Pininfarina

Mahindra & Mahindra Ltd. has finalized an agreement to buy the iconic Italian design house Pininfarina SpA in a deal worth €168 million ($185 million). The companies expect to complete the sale in the first half of 2016.

Under terms of the deal, the Indian SUV maker will gain a 76% stake in Pininfarina from privately held Pincar Srl, the Italian company’s controlling shareholder, for €25 million ($28 million). Mahindra is offering to buy shares held by other stakeholders at the same per-share price of €1.10 ($1).

Mahindra also has agreed to guarantee €115 million in debt and invest €20 million in the 85-year-old design company. Paolo Pininfarina, grandson of the company’s founder, will remain as chairman, and the company will continue to be listed on the Milan stock exchange.

Pininfarina has struggled with debt for a decade, posting its only full-year profit in 11 years in 2012. The company has been wooed by would-be buyers for more than five years.