L&T Said To Acquire 20% Stake In Mindtree From VG Siddhartha

Larsen & Toubro Ltd. has acquired a 20 percent stake in Mindtree Ltd. through a block deal on the stock exchange, people aware of the development said on condition of anonymity.

Nearly 3.28 crore shares changed hands at Rs 976 apiece on the BSE Ltd. in pre-market session, Bloomberg data showed.

Earlier, L&T had agreed to acquire the Cafe Coffee Day Group’s stake at Rs 976 per share. The group’s owner VG Siddhartha, along with its entities, sold their holdings through a block deal window, said the people cited earlier.

After the block deal, L&T Group will seek approval for the open offer process from Securities and Exchange Board of India, bankers involved in the transaction told BloombergQuint requesting anonymity. L&T had received approval from Competition Commission of India to acquire Mindtree earlier this month.

L&T has also placed an order with brokers to pick up another 15 percent shares from the open market, according to an exchange filing. The engineering major had earlier informed the exchanges that it plans to acquire an additional 26 percent stake through the open offer route. L&T’s open offer, which is priced at Rs 980 per share, is expected to open between May 14 and May 27, according to documents filed with SEBI.

Coffee Day Enterprises Ltd., a listed entity promoted by VG Siddhartha, held nearly 20 percent stake in Mindtree through a Standard Chartered Bank escrow account—named Project Carnation, Lotus & Marigold—as of March 31, according to an exchange filing.

As part of the transaction, the holdings of Coffee Day Enterprises—which once owned 10.6 percent stake in the mid-sized information technology firm—along with that of other group entities of VG Siddhartha, were consolidated into an escrow account from which it was sold to the L&T Group through block deals as agreed by the parties involved, said the people cited earlier.

The total deal value is estimated to be around Rs 10,800 crore.