Business

Larsen And Toubro Ltd. To Take Over Mindtree; Co-Founder Subroto Bagchi Resigns

न्यूज़ वर्ल्ड इंडिया | 0
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| March 18 , 2019 , 12:47 IST

Larsen & Toubro (L&T) planned to sign a deal with Café Coffee Day founder VG Siddhartha to buy his 21% stake in Mindtree NSE 0.96 % which led Subroto Bagchi co-founders of Mindtree resigned on Sunday as the head of Odisha Skill Development Authority and will return to Bengaluru.

However, after Bagchi's resignation, he tweeted and said, “An imminent threat of hostile takeover of Mindtree has made me resign from the (Odisha) government, (so that I will be) able to go and save the company,” he said. “I must protect the tree from people who have arrived with bulldozers and chainsaws so that in its place, they can build a shopping mall.”

Terming Mindtree a national resource, Bagchi said it has not been designed as an ‘asset’ to be bought and sold. “I need to be there in its time of difficulty. Hence, (I have taken) the hard decision to return,” Bagchi added.

Reportedly, L& T will soon launch an open offer for an additional 31% stake in the IT company, probably as early as Monday evening, said several people aware of the developments.

According to Sebi’s takeover rules, an acquirer can launch an open offer to gain control of a listed firm only it makes a public announcement to acquire more than 25% stake and voting rights in the listed firm eventually.

This section of the takeover law is rarely used. Typically, an acquirer first buys 25% in the listed company to trigger a mandatory open offer to take control of a listed firm.

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KPMG’s corporate finance team is handling the mandate for the entire deal and Axis Capital and Citigroup Global Markets are running the mandate for the open offer as bankers.

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