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Pininfarina's new strategy bolstered by debt deal
CAMBIANO, Italy |
CAMBIANO, Italy Feb 15 (Reuters) - Pininfarina , which in tough markets has downsized from a coachwork maker for high-end sports cars to focus on its automotive design business, said it had reached a debt restructuring deal with banks after long-running talks.
The Italian company, famous for designs including the Ferrari FF and Maserati Gran Turismo, will complete a 182.6 million-euro ($239.8 million) debt restructuring deal with 13 creditor banks by the end of March, Chief Executive Silvio Pietro Angori told shareholders on Wednesday.
The agreement with creditor banks will allow the loss-making company to pay back debt by the end of 2018, rather than 2015 as previously planned. The agreement, when signed, also cuts interest paid on debt to "well below market rates," its Chief Financial Officer Gianfranco Albertini said.
The debt restructuring talks were first announced at the end of 2008, when the automotive industry slumped along with the world economy.
Pininfarina has struggled to return to profit in recent years, after being forced to shut down manufacturing operations to focus on design and engineering services.
The company, founded in 1930 by Battista "Pinin" Farina, is hoping the debt restructuring and new business plan will allow it to turn the corner.
Its sales have fallen from an annual 670 million euros -- the bulk of which was from manufacturing -- in 2007 to 45 million in the first nine months of 2011.
Shareholders approved the company's new 2012-2018 industrial plan, as well as a motion to postpone a capital reduction to cover losses, which would have been necessary if the company had not reached the accord with creditors.
Pininfarina's business plan reflects its change in focus. It aims to grow its design and engineering business in Germany and the Far East; enhance the value of its brand through partnerships with third parties; and build on its know-how in electric cars.
Financial targets will be released on March 22 along with full-year results. ($1 = 0.7616 euros) (Reporting by Jennifer Clark; Editing by Jon Loades-Carter and Helen Massy-Beresford)
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