Business Today

L&T offers to buy 31% stake in Mindtree for Rs 5,030 crore

L&T offered to buy 5.13 crore fully paid-up equity shares of Rs 10 each from Mindtree at Rs 980 apiece. Last week, L&T bought 20.40 per cent stake in Mindtree from Cafe Coffee Day founder VG Siddhartha for about Rs 3,300 crore

twitter-logo BusinessToday.In   New Delhi     Last Updated: March 26, 2019  | 17:23 IST
L&T offers to buy 31% stake in Mindtree for Rs 5,030 crore
L&T on Tuesday made an open offer to acquire a 31 per cent stake in IT services firm Mindtree for Rs 5,030 crore.

Engineering and construction conglomerate Larsen & Toubro (L&T) on Tuesday made an open offer to acquire a 31 per cent stake in IT services firm Mindtree for Rs 5,030 crore ($730.20 million).

L&T offered to buy 5.13 crore fully paid-up equity shares of Rs 10 each from Mindtree at Rs 980 apiece.

Last week, L&T bought 20.40 per cent stake in Mindtree from Cafe Coffee Day founder VG Siddhartha for about Rs 3,300 crore and said it would raise its stake in Mindtree to 66.32 per cent by spending as much as Rs 7,464 crore through a combination of open offer and stock market purchase.

The company plans to acquire majority stake in the company, which has hit the hurdle as the promoters of the IT services company vocally opposed the takeover, saying that the engineering giant will bring no value to their company.

The Mindtree promoters--including Chairman Krishnakumar Natarajan, Subroto Bagchi, Managing Director Rostow Ravanan and Chief Operating Officer NS Parthasarathy--are holding an aggregate 13.32 per cent stake in the company.

According to back-of-the-envelope calculation, the promoters of Mindtree will get Rs 2,144 crore for their 13.32 per cent stake at Rs 980 a share.

Also Read: Will L&T splurge more to woo Mindtree promoters?

In a separate development, Mindtree board, at its meeting today, decided not to proceed with a buyback of equity shares of the company.

Further, the board invited views from the directors on the unsolicited offer made by L&T for the equity shares of the company. It has decided to immediately constitute the Committee of Independent Directors (IDC) in the interest of all stakeholders to provide their reasoned recommendation in respect of the unsolicited offer by L&T for the consideration of the shareholders.

"All the independent directors will be members of the IDC, and the IDC has elected Apurva Purohit, lead independent director, as the chairperson of the IDC and spokesperson," Mindtree said in a filing to the Bombay Stock Exchange.

Also Read: 'Our parents had no money, they only gave us idealism': Subroto Bagchi writes motivational letter to Mindtree employees

The company said that IDC will consider and evaluate all aspects of the unsolicited offer, taking into account all relevant facts, circumstances, data related to the Company and industry and the interests of all stakeholders involved. This committee will be supported by independent legal and financial advisors to help it with its deliberations.

Meanwhile, shares of Mindtree closed 1.1 per cent higher at Rs 950.55 apiece on the BSE on Tuesday.

Edited by Chitranjan Kumar

Youtube
  • Print

  • COMMENT
BT-Story-Page-B.gif
A    A   A
close