Pininfarina circling the drain

[exigeracer]

So last year we lost almost all of what was left of Stile Bertone, which brought gems like the Miura and Strato's. Next up on the chopping block is automotive giant Pininfarina, whose family ownership just put up their majority shareholding.

We're not talking about a couple historic designs here. This is Pininfarina. They created modern automotive design as we know and see it today. The unbelievable contribution they gave to the industry makes this quite a sad day.

Financial Times:

One of Italy's leading motoring dynasties has agreed to sell its controlling stake in a leading car company as part of a debt restructuring deal, underlining how the slump in the automotive industry affects some of the country's most prominent industrial families.

The Pininfarina family is to sell its 50.6 per cent stake in the group, also called Pininfarina, which designs and manufactures cars for Ferrari, Maserati and Ford, among others. The decision is part of the deal with its creditor banks, to which it owes nearly €600m ($838m).

The company said it would appoint three investment banks by the end of February to advise on the sale, which comes as Pininfarina struggles - like other high-end but marginal operators in the global automotive industry - to survive as a result of the financial crisis.

Pininfarina's future has been in question since the death in August last year, in a motorcycle accident, of Andrea Pininfarina, the company's 51-year-old chairman and chief executive. He was the grandson of Battista "Pinin" Farina, who founded the company in 1930 and who later changed the family name to Pininfarina. The firm is based in Turin, Italy's car capital.

Pininfarina is one of the many small Italian companies that comprise an economically crucial sector known collectively as "Made in Italy". It includes fashion houses, food producers, furniture manufacturers, and makers of other products that have made Italy synonymous with stylish, high quality goods, and it is heavily dependent on exports.

However, Pininfarina's fortunes shrank alarmingly during 2008.

Its share price fell by 67 per cent during the year, and it now has a market capitalisation of only about €36m. It had total debts of €598m at the end of November. Of that amount, €555m was the subject of the debt restructuring agreement that was agreed on Wednesday with a consortium of banks that includes UniCredit and Intesa Sanpaolo.

Pininfarina said the restructuring deal was a way to "[restore] equilibrium to Pininfarina's balance sheet and financial position".

Pininfarina made a loss of €117m in 2007 on revenues of €713m, and it was feared that without the debt restructuring agreement its losses in 2008 would have wiped out its capital.

As part of the agreement, the family is to assume €180m of the company's debt. Whoever buys the family's stake in Pininfarina will have to buy out the minority shareholders

http://www.ft.com/cms/s/0/9f38cbee-d86f-11dd-bcc0-000077b07658.html

Pretty much every Ferrari you can name came from them, the styling direction that Alfa Romeo took from 1954 onwards (not to mention actual production of many models), longtime relations with Fiat, Peugeot and Ford. This is bad news!

 

[Moglet]

This is bad news, I hope it's not the first sign of 'luxury' brands and companies going down the pan

 

[Omnis]

Sometimes I wonder why Porsche management doesn't run every company.

 

[Stevisiov]

This is bad news, I hope it's not the first sign of 'luxury' brands and companies going down the pan

Nope, Porches and Lambo are looking stronger and stronger.

 

[Jim Prower]

Meh, Ferraris are on the "dislike" list right now for me. For one, the recent Ferraris have been....lackluster, for lack of a better term, and I don't think there's much more to Pinin than Ferrari's Design Studio. I'll bet their assets will be bought by Ferrari anyway.

 

[YSSMAN]

I guess I'm at a loss as to why they would have so much debt. They don't design only automobiles, I could have sworn that I've seen portable hard drives (among other things) with the Peninfarina name on it. Hmmm.

In-house designs have come a long way in the past few years, but nevertheless, Pininfarina is the designer for so many companies. Hopefully things eventually turn out well.

 

[Philly]

Nope, Porches and Lambo are looking stronger and stronger.

In fact, all things Porsche and VAG and Audi ect. seem to be doing pretty decently. Nobody else really is though.

I'm sure we'll see the company turn around once things start to shapen up. In-house design is becoming more popular but Pininfarina is a pretty important company.

 

[exigeracer]

I guess I'm at a loss as to why they would have so much debt. They don't design only automobiles, I could have sworn that I've seen portable hard drives (among other things) with the Peninfarina name on it. Hmmm.

They've got a massive production arm. They currently produce the Alfa Spyder and Brera, along with some Ford all in-house. They also have research projects going (their current electric car platform) that can easily suck that money away.

 

[YSSMAN]

Ah, I see, unfortunate nevertheless. All we can really hope for is that selling some of the shares of the company saves it from an untimely death.