By Stefano Rebaudo
MILAN (Reuters) - The key investor in Pininfarina
The sources said the parties involved were trying to reach at least a preliminary accord by the end of July after failing to strike a deal before a shareholder meeting on April 29.
Pininfarina declined to comment. Mahindra did not answer a request for comment. Leading creditor banks UniCredit
A third source close to the matter said Mahindra may push back further a possible deal in order to agree on a lower price.
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Pininfarina is hard pressed for time. Its operating loss more than doubled in the first quarter from a year earlier. It expects to post an operating loss in the full year and sees net debt at the end of 2015 above the previous year's level.
It said in May that it would struggle to meet targets set by creditors for this year's earnings before interest, tax, depreciation and amortisation (EBITDA).
The breach of the EBITDA covenant would give creditor banks the right to ask Pininfarina to repay its bank debt, which has a nominal value of 102 million euros. But the third source said that the banks were likely to look for ways to allow the company to continue operating.
A new debt restructuring is the most likely option, two sources said, after a similar agreement was agreed in 2012 and would expire in 2018.
An Italian daily reported on Saturday that some of Pininfarina's creditors had rejected Mahindra's 80-million euro ($89 million) offer as it envisaged writing off half of the group's debt.
($1 = 0.9032 euros)
(Writing by Valentina Za, editing by Silvia Aloisi)
