Some Mindtree promoters want to exit: AM Naik, L&T

Mindtree promoters have only 13% stake and one cannot hope to have management control for long with only 13%. . Many private equities were eyeing it, said AM Naik, Group Executive Chairman, L&T, in an exclusive interview with ETNOW.

Edited excerpts:

Mindtree promoters are saying that L&T Infotech is attempting an hostile takeover. How would you defend that?

First of all, in our mind it is not a hostile takeover. The promoters have only 13%. Many private equities were eyeing it and one cannot hope to have management control for long with only 13%. We have been hearing off and on that some of the promoters want to exit.


They may have other reasons to continue for some time but there will come a time within a year or two, when they would have to finally give it to a safe company with very high reputation, whose employees relationship is superb and which at the same time comes from IT space. We already have L&T Infotech and L&T Technology Services and we have become a $3-billion company.

What happens if Mindtree promoters come out with an counter-offer -- be it a buyback or if they get a white knight?

They do not have money for buyback. They have Rs 1,000 crore cash maximum, with which they will get 3.5-4%.

What if they get a third party funder and come up with a counteroffer? Would you be looking at increasing your price proposition?

I cannot comment on it. We will see as it comes.

Is the eventual to merge Mindtree with L&T Infotech, considering their portfolios are so different or they will be run as a separate entities?

Too early to say anything now. We will go and buy as it happens.

Why is L&T Group so keen on acquiring Mindtree as an asset? What are the synergies?

This question is irrelevant. We have an IT company, we have a technology service company. It is a natural addition to make the companies fairly sizable.

What are you expecting from Mindtree board today? Are you expecting the founders to retaliate?

What I read from media and newspaper that they are not likely to approve it. They will have their own decision but it is in the interest of employees to really get going with L&T and it is a really very positive move by L&T to really take them.

Is Mr V G Siddhartha going to completely exit Mindtree?

Please talk to Mr Subramaniam and Shankar Raman. I do not know these details.