Larsen & Toubro has bought about 20% in the IT services company from VG Siddhartha through block deals on the stock exchanges, according to data on the BSE.
L&T said in March it would make an open offer to buy an additional 31% stake in Mindtree after signing a deal on March 19 with long-term investor and Cafe Coffee Day promoter Siddhartha to buy his 20.32% holding in the company for Rs 3,269 crore.
Through Tuesday’s block deals, L&T bought more than 32.7 million shares, or almost 20% of the stake held by Siddhartha and his Cafe Coffee Day affiliate firms, at Rs 980 per share.
“If you do transaction through the securities market, the exchanges, then you are entitled to long-term capital gains exemption. That’s the reason why they would have done the deal on the stock exchange,” said JN Gupta, founder of Stakeholders Empowerment Services and former executive director of the Securities and Exchange Board of India.
L&T needs to acquire an additional almost 5% stake in Mindtree to reach the 25% threshold that will trigger an open offer. It has placed an order with its stock broker Axis Capital to buy a 15% stake from the market on the condition that the transactions will be done only after approvals from regulators.
Mindtree, the Bengaluru-based IT services company that crossed $1 billion in revenue in the previous financial year, is awaiting recommendations from a committee of independent directors by May 10 on whether its shareholders would benefit by selling their shares to L&T. The open offer is scheduled to begin on May 14.
