Troubled Italian car designer Pininfarina is still hoping to clinch a sale to Indian vehicle maker Mahindra and Mahindra but has begun drafting a stand-alone business plan as its financial position worsens.
Pininfarina forecast on Thursday a full-year operating loss and said it did not expect to be able to meet at the end of the year a target for earnings before interest, tax, depreciation and amortisation agreed with creditors as part of its debt restructuring.
“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,” the company said in a statement.
The group famous for designing Ferraris such as the Testarossa said it expected to present the new plan to creditor banks in the last quarter of the year.
Pininfarina’s controlling shareholder Pincar and banking creditors failed to agree a sale of the indebted group to Mahindra this month, sources close to the matter said this week.
Talks would resume in September but one source said Mahindra was “very cautious” and wanted to invest in Pininfarina “at the lowest possible price”.
On Thursday, Pininfarina reported a first-half net loss of 4.4 million euros, in line with the previous year, and said its net debt stood at 52.7 million euros at the end of June up from 44.8 million euros at the end of December.