Mindtree Ltd shares nosedived as much as 14.6% in intraday trade on Friday, i.e. 8 July, as the top management resigned after Larsen and Toubro Ltd (L&T) acquired a controlling stake in the company.
Mindtree’s top brass -- Krishnakumar Natarajan, N.S. Parthasarathy and Rostow Ravanan -- submitted their resignations as board of directors and employees of the company after infrastructure major L&T acquired more than 60% stake in the IT firm last week.
“Krishnakumar Natarajan, executive chairman, N.S. Parthasarathy, executive vice chairman and chief operating officer, and Rostow Ravanan, CEO and managing director, have submitted their resignations as members of the board of directors and as employees of the company,” Mindtree said in its BSE filing on 5 July.
Mindtree added that the three will stay as board members and employees till 17 July in line with their employment contracts to ensure a smooth transition. “Further, along with the other founders of the company, they have asked the company to de-classify them as promoters under applicable laws,” it said.
Mindtree said it would announce a new leadership team in due course.
Last week, L&T was able to acquire a majority 60% stake in Mindtree after its open offer to buy 31% shares got oversubscribed. The company had bought 20.32% shares in Mindtree from V G Siddhartha and his Coffee Day Enterprises for over Rs 3,000 crore in March and subsequently made an open offer to buy an additional 31% stake.
The development came within months of Mindtree rejecting a hostile takeover bid from L&T, saying that it will not be in the interest of the company or its shareholders.
At 1.33 pm, shares of Mindtree were trading at Rs 772 apiece, down 13%, on the National Stock Exchange (NSE). L&T shares were, meanwhile, trading down 4.2% at Rs 1,493 apiece.
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