L&T is now classified as Mindtree promoter; Infosys delays hikes for seniors
Engineering conglomerate Larsen & Toubro (L&T) has been classified as the promoter group of Bengaluru-based information technology (IT) services firm Mindtree following the acquisition of around 60% stake in the company, an exchange filing showed.
Mumbai-based L&T had on 2 July paid Rs 5,030 crore to Mindtree shareholders, whose shares were accepted in the open offer that began on 17 June, the company said.
Mindtree founders, who were the promoters before the hostile takeover, had opposed L&T’s bid citing lower valuation as well as cultural differences between the two companies.
Last month, three L&T executives, including chief executive and managing director SN Subrahmanyan, were appointed to the Mindtree board.
IT giant Infosys has delayed salary increments to its senior executives, The Times of India reported. The increments were due from April, then promised in July, and now have been further delayed.
According to the report, the hikes are expected to be in the three to five per cent range.
The IT industry has been facing margin pressure due to increased hiring for onsite locations following the curbs on H1B work visas by the US government. The US is by far the largest market for the export-oriented Indian IT sector.
Infosys has hired over 9,000 employees in the US over the past few years with a resulting drop of at least one per cent in operating margins.
L&T Infotech has lost part of its outsourcing deal with technology giant Apple after their relationship soured due to a US visa-related imbroglio, The Times of India reported, adding that the company will lose the whole deal as soon as a replacement is found.
The deal is estimated to be worth $25 million (about Rs 172 crore at current exchange rate) annually.
According to the report, L&T Infotech was being questioned by the United States Citizenship and Immigration Services for documentary discrepancy and procedural lapses while securing visas for its employees who were supposed to work at client Apple’s location.