CORPORATE WORLD

L&T confident of taking control of Mindtree: AM Naik

Staff reporter, New Delhi
13/06/2019   0 Comments

Larsen and Toubro (L&T) will soon garner more than 40% stake and pursue its open offer for Mindtree, chairman AM Naik said, even as he criticised the sustained hostile approach to the takeover by the founders of the mid-tier IT services firm. The engineering giant has ramped up its stake in the Bengalurubased company to 28.9% currently and its open offer to buy a further 31% will open on June 17 and close June 28. “We have committed Rs 4,000 crore already into this deal and we will not let anything stop us. There are no Sebi  or regulatory concerns raised around it. The deal will be completed successfully,”. Mindtree’s founders, who own a combined 13% stake in the company, have termed L&T’s takeover “hostile”. 

“Mindtree had a golden opportunity to combine with L&T to be part of a growth story, but it has stubbornly been hostile about it,” Naik said. “We have categorically said that this is not a hostile offer. But when an opportunity presents itself to us when one of the early investors, Siddhartha, approached us three times for the deal, are we supposed to ignore it?” Mindtree chairman Krishnakumar Natarajan and CEO Rostow Ravanan did not answer calls seeking a response to Naik’s comments on the deal. In March, L&T signed an agreement with Cafe Coffee Day chairman VG Siddhartha to buy his 20.32% stake in Mindtree. L&T bought the shares in a block deal at Rs 980 per share in April. Since then, L&T has also bought from the open market to shore up its holding. 

Naik said L&T did extend a hand of friendship to Mindtree’s promoters, including an offer to make Natarajan the “chairman of the combined entity”, but they have stuck to their hostile approach. “But that doesn’t deter us,” he said. “We have made an open offer at the best price and we are going ahead with our plans to acquire it. We are confident of the deal and will not let such speculations distract us,” said Naik. 

On Wednesday, Mindtree’s independent board members said the open offer was “fair and reasonable”. Separately, BT reported on Tuesday that a few institutional investors of L&T and Mindtree have written to Sebi against an alleged move by Pulak Prasad, the founder of storied investment manager Nalanda Capital, to provoke minority investors in Mindtree to spurn L&T’s open offer. The investors have complained to the market regulator that Prasad was effectively acting in concert with the promoters of Mindtree in an attempt to persuade institutional shareholders such as Arohi Asset Management to hold back from tendering shares in the open offer. 


 

WRITE A COMMENT

...
Sign in with
Or procced without registration