A Magna International Inc. executive confirmed the Canadian-Austrian supplier's interest in design and engineering firm Pininfarina S.p.A.
“This type of acquisition would be one that would earn us additional competence on development matters,” Dieter Althaus, a vice president at Magna's European unit, told Bloomberg News on Wednesday. “We're also very considerably engaged in the field of engineering and that's where design and technology also play a role.”
Trading of shares in Pininfarina was suspended Wednesday following an Automotive News Europe report that Magna is weighing a proposal to buy the struggling Italian firm.
Trading resumed late Wednesday after Pininfarina issued a statement saying: "As of today, we are collecting expressions of interest from potential buyers. Whenever any negotiations have reached a stage where it needs to be communicated, the company will do with the usual transparency."
Shares in Pininfarina opened trading today on a positive note after reaching a 19-month high Wednesday.
Pininfarina shares were trading at 3.60 euros on the Milan stock exchange at 9:25 CET, up from the 3.51 euro close on November 17, which was 22.3 percent gain on the day before, valuing the company at 105.9 million euros.
Last year Pininfarina put a 71.2 percent stake up for sale that was held by the group's family holding company Pincar, to help it try to reverse chronic loses. The company has struggled financially for years, losing a combined 358 million euros from 2007 to 2009.
The Pininfarina family's share of the company has shrunk from 55 percent to just 1.2 percent.
Pininfarina was founded 80 years ago by Battista Pininfarina, the grandfather of current chairman Paolo Pininfarina.
On Nov. 12, Pininfarina said it expects a 2010 loss wider than last year's after the nine-month net loss broadened to 33.8 million euros (45.8 million) from 18.1 million euros a year earlier.
After failing to buy General Motors Co.'s Opel/Vauxhall unit last year and Chrysler Group a year earlier, Magna has decided to stop pursuing automakers and instead focus on its core business of being a global supplier of parts and services, including contract manufacturing.
Magna is eyeing Pininfarina to strengthen its position as a global supplier of design, engineering and contract manufacturing, one source told ANE.
Pininfarina's design expertise and engineering know-how would augment the range of services offered by Magna subsidiary Magna Steyr, which engineers complete vehicles and builds cars for several automakers at its assembly plant in Graz, Austria.
Pininfarina is known for building legendary sport cars such as the 1966 Alfa Romeo Spider and the 1984 Ferrari Testarossa.