Larsen & Toubro Ltd. will provide further impetus to Mindtree Ltd.'s growth by providing board-level oversight and relevant client connections, L&T told the Bengaluru-based IT firm's shareholders at its annual general meeting today.
The Mindtree AGM is the first since L&T acquired 60.06 percent stake in the company in a hostile takeover bid that started in March.
Following this, Mindtree co-founders and board members—Chairman Krishnakumar Natarajan, Chief Executive Officer Rostow Ravanan and Vice Chairman Parthasarathy NS—resigned.
At the Mindtree AGM, L&T CEO SN Subrahmanyan said he believed that L&T, with its experience of managing L&T Infotech Ltd. and L&T Technology Services Ltd., can add value to Mindtree and its shareholders.
“L&T can provide further impetus to long-term growth of Mindtree by way of board-level oversight and relevant client connects,” he said. “We will be able to harness these relationships for the benefit of Mindtree's stakeholders.”
He complimented Mindtree founders and former promoters, who are first generation entrepreneurs, for building a “unique culture” and creating a billion-dollar revenue business entity.
“Mindtree originated with a set of professional founders who had nothing other than their skills and a shared sense of purpose to create something special,” Subrahmanyan said. “This shared mission, passion and spirit of ownership contagiously spread across multiple layers of employees, leading to a unique organisational culture that delivered exceptional results for clients and shareholders.”
He reiterated that a merger of Mindtree with L&T Infotech and L&T Technology Services isn't on the cards. “Mindtree will be kept distinct from L&T Infotech, L&T Technology Services and the recently-formed business division L&T-Nxt.”
These entities would run at an arm's length, he said. “There are other major conglomerates in India like Tata, Mahindra, Hinduja and HCL which have also been running multiple IT companies successfully.”
Subrahmanyan said L&T will focus on delivering best levels of service to Mindtree's clients. “We will strive to provide new age technologies, services, digital and content in an ever more increasing manner to take the organisation forward.”
The L&T-Mindtree acquisition marked India's first-ever hostile takeover in the IT space. The infrastructure giant had bought 20.32 percent shares in Mindtree from VG Siddhartha and his Coffee Day Enterprises Ltd. for over Rs 3,000 crore in March.
Later, it shored up its holding with more share purchases from the open market, before making an open offer for an additional 31 percent stake, taking its shareholding to over 60 percent.
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