L&T gets three board seats at Mindtree; Subroto Bagchi to step down

Three Larsen & Toubro (L&T) executives, including CEO and managing director SN Subrahmanyan, have been appointed to the Mindtree Ltd board, according to a BSE filing by the Bengaluru based software services firm. The three will join as non-executive directors, effective July 16. 

Separately, Subroto Bagchi, the firm’s co-founder, who retires by rotation the same day, has not offered himself for re-appointment. 

Apart from Subrahmanyan, the other two top L&T executives appointed to the Mindtree board are Jayant Damodar Patil, director and senior executive vice president for L&T's defence business, and CFO R Shankar Raman. 

The Mindtree board also announced the appointment of two independent directors. MR Prasanna, a legal consultant and former chief legal officer at L&T, and Deepa G Wadhwa, a diplomat with the Indian Foreign Service.

L&T is currently the largest stakeholder in Mindtree with around 30% stake and is aiming to increase its shareholding to more than 60% via an open offer that commenced on June 17. 

The offer, which came after a delay of nearly a month, is being managed by Axis Capital and Citigroup Global Markets' India division. L&T has offered to buy Mindtree shares at a price of Rs 980 per share. Assuming full acceptance, it will spend as much as Rs 5,029 crore to acquire a controlling stake in Mindtree.  

Just five days before the offer went live, the independent directors of the company had said that the offer was fair and reasonable.

The open offer was scheduled to start in the first half of May but was delayed as capital markets regulator SEBI had asked for clarifications from L&T. On May 31, the Securities and Exchange Board of India approved the engineering major's open offer to buy Mindtree shares.

In April, L&T had completed the purchase of almost 20% stake in Mindtree from its largest shareholder VG Siddhartha and two of his entities at Rs 980 a share for more than Rs 3,200 crore.

The Mumbai-based engineering and construction firm has also been steadily buying Mindtree shares from the open market; its total stake stood at 28.88% by the end of May. 

The deal is one of the most high-profile hostile takeover bids in Indian corporate history. Mindtree's founders, who own a little more than 13% stake in the firm, had opposed L&T's bid.

The Competition Commission of India had approved L&T's proposal to take over Mindtree in April.