- LTI and Mindtree will operate as one entity from November 14, 2022.
- Mindtree will be delisted and LTI will be renamed LTI-Mindtree.
- Shares of LTI will be issued to all Mindtree shareholders at the rate of 73 shares of LTI for every 100 shares of Mindtree.
- The record date for issue of shares of LTI under the scheme is November 24, 2022.
Larsen & Toubro (L&T) Group said Monday that the National Company Law Tribunal (NCLT) has approved the merger and settlement plan between L&T Infotech and Mindtree. NCLT’s Mumbai and Bengaluru banks have approved the scheme, under the provisions of the Companies Act, 2013.
Both companies will effectively function as a single entity from November 14, 2022. Mindtree will be delisted and LTI will be renamed LTI-Mindtree. Shares of LTI will be issued to all Mindtree shareholders at the rate of 73 shares of LTI for every 100 shares of Mindtree.
The parent company, L&T, will own 68.73% of the merged entity. The record date to determine which Mindtree shareholders are eligible to issue LTI shares under the plan is set for November 24, 2022.
“The merger between LTI and Mindtree creates the sixth largest IT company by revenue and the fifth largest by market capitalization. The IT sector will be hit by geopolitical tensions and more, but the merged entity will be better equipped to cope,” said
“The merged entity will have economies of scale, streamlined delivery and multi-industry presence. Mindtree and LTI’s work ethic is consistent and does not anticipate HR challenges with integration,” said Debashis Chatterjee, CEO and MD of LTIMindtree. The merged entity will have a workforce of 90,000.
Naik also said that the turnover problem of the IT sector could decrease in the future. “There has been a warlike situation and war itself. The first thing companies will cut back on is overheads, including IT. Turnover in the IT industry is around 23-24% and could decrease by 4-5%,” he said without giving a timeline.