Infratsructure and engineering major, L&T is expected to purchase the 20.4% stake held by the CCD founder V.G. Siddhartha and his two other affiliate of the same company in mid-sized Information Technology company, Mindtree. Further, the company can also make bid for another 31% stake in Mindtree via an open offer as early as Monday evening, sources familiar with the development cited.
Also, as per the sources knowledge on the deal, L&T is ready to pay Rs. 981 per share for the full stake that is held by CCD founder and two of his other affiliate firms. So, the deal is likely to value Mindtree at Rs. 16,250 crore.
"L&T will buy the 20.4% stake and will announce an open offer to buy up to 51% in Mindtree on Monday evening," said the first executive, on the condition of anonymity.
The deal is being deemed as the first hostile takeover in the Indian IT space as L&T is following only a section of the code stipulated by the SEBI for the takeover of a listed firm, as per which the acquirer needs to first acquire 25% stake in the acquiring company and thereafter can only place the open offer to gain control of the listed entity.
The corporate finance team of KPMG is handling the mandate for the entire deal and Axis Capital and Citigroup Global Markets are running the mandate for the open offer as bankers.
Also, on the sidelines, Mindtree's board has announced to meet on March 20 to consider buyback of its fully paid up equity shares from the market to prevent the occurrence of this hostile takeover.