Mindtree Opposes Takeover Bid, L&T Rules Out Merger With IT Arm
L&T made an offer on Monday to buy up to 66 per cent stake in Mindtree
L&T made an offer on Monday to buy up to 66 per cent stake in Mindtree(Photo Courtesy: PTI)

Mindtree Opposes Takeover Bid, L&T Rules Out Merger With IT Arm

Strongly opposing Larsen and Toubro’s (L&T) hostile bid, Mindtree promoters on Tuesday, 19 March, asked why the infrastructure giant could not build a great technology business on its own and wondered what kind of a message is being sent to start-ups and credible entrepreneurs with the takeover attempt.

Also Read : Startups Expecting A New Definition and ‘Angel Tax’ Relief

Posing five questions to diversified L&T, which already has two separate IT firms, the promoters also wanted to know what would happen if Mindtree employees choose to leave after the takeover.

"You are a company with a turnover of Rs 1,20,000 crore, you are 18 times the size of Mindtree. Why can't you build a great technology business with your resources and capability without disseminating another organisation," Mindtree promoter and Executive Chairman Krishnakumar Natarajan said in a press conference.

In the country’s first hostile takeover bid in the IT sector, L&T made an offer on Monday, 18 March, to buy up to 66 per cent stake in Mindtree for Rs 10,733 crore. In a three-pronged acquisition of Mindtree, it will pay Rs 980 a share to buy Cafe Coffee Day owner V G Siddhartha’s 20.32 per cent stake in Mindtree, buy 15 per cent from the public and mount an open offer at Rs 980 a share later.

Also Read : This Indian Startup Will Launch Its First Satellite With Space X

On Tuesday, the engineering major also ruled out merging Mindtree with its IT arm for the time being. “We have not thought about integrating Mindtree with us (L&T Infotech). For the time being, it will be run as an independent entity,” L&T Managing Director and chief executive S N Subramanyan told reporters here on Tuesday.

(The Quint is now available on Telegram. For handpicked stories every day, subscribe to us on Telegram)

Follow our Business section for more stories.

    Also Watch