L&T’s Hostile Takeover of Mindtree
Co-promoters of Mindtree were forced to leave their company after twenty years of successful operation when L&T, a conglomerate, purchased it. V G Siddhartha was a passive investor in the company, but he had to sell his 20% share to pay off the significant debt from his main business. In their capacity as promoters
When Mindtree was unable to secure the funds necessary to purchase his interest, he turned to L&T. which purchased his stock.Later, L&T bought a larger share of Mindtree from the public from FIs and the market.Ineffectively, the three co-promoters in top roles at Mindtree and another co-promoter, Subroto Bagchi, attempted to thwart the unwanted buyer.
The co-promoters of Mindtree were forced to step down and deal with the unpleasant truth that L&T, the company's new owner, would now be seen as the promoter as they lacked the means to buy out the biggest individual shareholder and a majority interest in the business. The founding backers of Mindtree had founded and grown the business into a multinational provider of IT services.
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