CCI approves L&T’s acquisition of 66% stake in Mindtree
L&T signed a deal to buy 20.32 per cent stake of VG Siddhartha and his coffee enterprise on March 10 for over Rs 3200 crore at Rs 980 per share. The engineering and construction major made an open offer to buy 31 percent stake from Mindtree’s shareholders and an addition 15 percent through on-market purchase.
April 05, 2019 / 09:25 PM IST
The Competition Commission of India (CCI) on April 5 approved L&T's proposed acquisition of a 66.15 percent stake in Mindtree.
In a tweet, the competition watchdog said: “CCI approves acquisition of up to 66.15% of the total equity shareholding of Mindtree Limited, on a fully diluted basis, by Larsen and Toubro Limited."
L&T signed a deal to buy 20.32 percent stake of Mindtree's largest shareholder VG Siddhartha and his coffee enterprise on March 19 for close to Rs 3,200 crore at Rs 980 per share. The engineering and construction major made an open offer to buy 31 percent stake from Mindtree’s shareholders and an additional 15 percent through on-market purchase.
The total value of the hostile bid was close to Rs 11,000 crore.
Mindtree promoters, who hold a total of 13.32 percent shares, had condemned the hostile bid initially.
L&T in its detailed public statement announcing the open offer on March 26, said that the object and purpose of the acquisition of a controlling stake in Mindtree to grow the revenue and profits of its information technology and technology service areas.
After the announcement, Mindtree board scrapped its buyback plan and constituted a committee of four independent directors to review the open offer and advise stakeholders whether to go for open offer or not.
The committee, headed by Apurva Purohit, held its first meeting recently and has roped in Khaitan & Co and ICICI Securities for assisting the committee in coming up with recommendations.
The committee has to give its recommendations by May 10 before the commencement of an open offer by L&T on May 14.