Indian group Mahindra takes over Pininfarina

MILAN (AP) - The Mahindra industrial group based in Mumbai, India, announced Monday it had reached a deal to buy a controlling stake in the Italian design firm Pininfarina, most famous for its designs for Ferrari, Alfa Romeo and Maserati.

Shares in the 85-year-old Italian company dropped by nearly 70 percent on the news, to close at 1.31 euros. That compares with 4.20 euros last Friday.

Under the deal, two of the Mahindra group's units, Tech Mahindra and Mahindra & Mahindra, will buy 76.06 percent of the design firm from the Pininfarina family's holding company, Pincar, for 1.10 euros a share. The deal calls for an open offer for the remaining Pininfarina shares held by Pincar to be completed by the end of 2016.

Mahindra is to invest 20 million euros to recapitalize Pininfarina, which will remain an independent company listed on the Milan Stock Exchange with Paolo Pininfarina staying on as chairman

Mahindra said in a statement that the acquisition will give it entry to automotive styling while contributing to its transportation, aerospace and industrial design work. The vast Mahindra group is worth $16.9 billion, employing 200,000 people in 100 countries, with Tech Mahindra representing $3.9 billion.