Discussions about a takeover of Pininfarina by Mahindra will reportedly resume in September 2015.
Sources have informed Reuters that talks between Mahindra & Mahindra and Pininfarina will recommence after the northern summer. The two parties have been discussing a possible takeover for several months now.
According to one of the news wire’s sources, Mahindra is “very cautious and plans to invest in Pininfarina at the lowest possible price”.
The design firm said in a statement that “although it hopes for a positive outcome of ongoing talks [with Mahindra], the board is working on new standalone business and financial plan more in line with the group’s current ability to generate cash to repay its debt”.
Another potential roadblock was removed in recent weeks when an Italian court made a labour ruling in Pininfarina’s favour. The court upheld an earlier decision that Pininfarina did not have to rehire 900 former employees, who were included along with the Grugliasco factory that the design company sold to De Tomaso in 2009. De Tomaso filed for bankruptcy in 2012 and was revived earlier this year by a Chinese-backed company.
Above: Peugeot 406 coupe.
News of Mahindra’s interest in Pininfarina began leaking out in March of this year when reports surfaced of discussions between the Italian design studio and the Indian car maker.
A deal was allegedly close to conclusion, but it emerged late last month that Pininfarina’s creditor banks rejected Mahindra’s demand that they write off roughly half of the design firm’s 87 million euros ($131 million) worth of debt.
Above: BMW Pininfarina Gran Lusso concept.
Despite that though, the company has suffered losses in 10 out of the last 11 years, with much of the red ink blamed on the company’s now defunct contract manufacturing division.
Pininfarina lost 4.4 million euros ($6.6 million) in the first half of 2015, roughly equivalent to the amount it lost at the same time last year.