L&T set to buy 20.4% in Mindtree- Bengaluru: Diversified group Larsen & Toubro (L & T) is ready to start a hostile bid for the acquisition of mid-level IT service company MindTree, which will probably start on Monday evening. It will buy V G Siddhartha, the founder of Coffee Day and Vinde Siddhartha, the largest shareholder in MindTree, and will go ahead with an open offer for public shareholders, with a spending of Rs 7,000 crore (or $ 1 billion) for a controlling interest, To tell the information directly.
L&T set to buy 20.4% in Mindtree, L&T’s Takeover Bid For Mindtree
This will be the first hostile takeover step in India’s technology industry, and in recent history, there will be a rare, fully developed conflict for the publicly traded company. Two decades old, four remaining founders of Bangalore-headquartered MindTree – Krishnakumar Natarajan, Subroto Bagchi, NS Parthasarathy, and current CEO Rostow Ravanan – together with 13.3% MindTree and opposing L & T’s bid.
According to sources mentioned that after the exit of Siddhartha, it may take a shock of M & A for MindTree in its December 17 edition. India Inc has witnessed very less successful hostile acquisitions – In the notable exceptions, in 1998, the acquisition of Rassi Cement of India Cements, led by N Srinivasan, and in the late 1980s to take control of Shaw Wallace in Manu Chhabria Have to join. For the latest updates and trending news, you can visit www.indiatimelines.com.
A M Naik-helmed L& T, Siddhartha is buying a 21% stake of over Rs 3,000 crore for Rs 981 per share, which will make it the largest shareholder of MindTree. After this, L & T will trigger an open offer for another 26% from public shareholders. KPMG Corporate Finance is the leading transaction advisor, while Citigroup and Axis Capital will manage the open offer process.
In the last two months, the founders have spoken to many private equity investors – KKR, Baring Asia and Chryscapital, among others, to counter the counter. But these talks have sparked this with at least three reasons: the reluctance of the founders to share much control; Most private equity investors cannot match the offer of L& T, And there is a possibility of an expensive acquisition battle against a turnover group of about Rs 120,000 crore.
L&T to make 1st-ever hostile bid in Indian IT for Mindtree, L&T set to buy 20.4% in Mindtree
On contact, L & T refused to answer, while Siddhartha could not get the immediate comment.
L & T has monitored MindTree for a while because it is a scout for M & As in the consolidated field. Revenue of approximately $ 1 billion and rapidly increasing digital revenues – indicating customers to strengthen new technologies such as AI, Cloud, Big Data and Analytics – makes MindTree especially attractive targets.
Siddhartha, the first investor to return the founders, talked about the plan to exit about 10 months immediately after the company left the board. They searched for various options and even sought the support of the founders for the monetization of holdings. Siddhartha, son of former Karnataka Chief Minister S M Krishna, wanted to stop his ballooning loan, as the liquidity pressure increased after the NBFC crisis at the end of last year.