BMW has acquired the Alpina brand in a deal that will start in 2025 after close to 60 years of working with the firm.
The two companies initially agreed a new five year working arrangement in 2020 and will honour that deal before the takeover.
However, once it expires on December 31, 2025, Alpina will become part of the BMW Group for the first time.
A restructuring of staff will then take place, with some Alpina workers possibly being moved to work for other BMW Group brands.
Up until that point Alpina is expected to continue operating as normal and even after the takeover, the brand will continue to be based at its Buchloe factory.
BMW has said the acquisition was made as switch towards electrification makes it difficult for smaller manufacturers, like Alpina, to survive independently.
No financial details have been revealed about the acquisition although BMW has confirmed it will not take any shares in Alpina.
Jens Thiemer, senior vice president customer and brand BMW, described the move as ‘a perfect fit’.
Pieter Nota, member of the board of management responsible for customer, brands and sales, added: ‘The automotive industry is in the midst of a far-reaching transformation towards sustainable mobility.
‘For that reason, existing business models need to be re-examined on a regular basis. For over 50 years, the Buchloe firm has demonstrated how to deliver top-quality car cachet through meticulous attention to detail.
‘The BMW Group is also driven by this same passion for cars that capture the imagination. That is why we are now embarking on a new chapter in our long-standing partnership.
‘Acquiring the trademark rights will allow us to shape the long-term course of this brand steeped in tradition.’
Alpina, founded in 1965, has a proud history on tuning special edition BMW vehicles and also has a thriving business building its own cars.
Last year it experienced its best ever year of sales, selling more than 2,000 vehicles to customers worldwide.
In the UK, the brand is represented by dealer group Sytner.
Andreas Bovensiepen, co-managing director of Alpina, said: ‘We recognised the challenges facing the automotive industry early on and are now setting the right course for Alpina and for our family firm, Bovensiepen.
‘This marks the beginning of a new chapter. Both the Alpina brand and our company are extremely desirable.
‘We made a conscious decision not to sell Alpina to just any manufacturer, because BMW and Alpina have worked together and trusted one another for decades.
‘That is why it is the right decision strategically for the Alpina brand to be managed by the BMW Group in the future.’