Cafe Coffee Day founder VG Siddhartha is reportedly in talks to sell his 21 percent shareholding in IT services firm Mindtree to address his liquidity issues, according to media reports. He is the single largest shareholder in the mid-size IT services headquartered in Bengaluru.
In December, Mint had reported about Siddhartha’s intended stake sale and had said private equity firm KKR and Co has evinced interest in buying a large stake in Mindtree, according to sources who spoke to the newspaper.
However, Siddhartha is said to be in advanced talks with L&T Infotech, KKR, Baring Private Equity Partners Asia and Prem Watsa's Fairfax and is expected to conclude a deal with one of them in the next 10 days, according to a report in The Times of India.
He is said to have met with AM Naik, non-executive chairman of L&T Infotech last week, said an ET report, stating the firm is closing in on the potential deal in 10-days time.
The four founders of Mindtree -- Subroto Bagchi, NS Parthasarathy, Krishnakumar Natarajan and Rostov Ravanan-- together own 13 percent in the firm.
Siddhartha has gradually increased his stake, betting on the sector as well as the company's growth potential, a report in The Economic Times said. Siddhartha owns 3.34 percent stake in Mindtree while Coffee Day Enterprises holds 10.65 percent, and Coffee Day Trading 6.46 percent, a PTI report said.
Serial entrepreneur and veteran IT professional Ashok Soota, along with nine other industry professionals, had set up MindTree in August 1999. Mindtree posted 35.1 percent rise in consolidated net profit at Rs 191.20 crore for the December 2018 quarter as against the year-ago period. The firm registered a net profit of Rs 141.50 crore during October-December 2017, the IT-services firm said in a BSE filing. Revenue grew 29.7 percent to Rs 1,787.20 crore in the reported period from Rs 1,377.70 crore in December 2017 quarter. The board of directors recommended an interim dividend of Rs 3 per equity share.
In morning trade, shares of Mindtree were 2.09 percent up at 906 in afternoon trade while CCD's parent, Coffee Day Enterprises was 0.77 percent down at 291.70.
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Updated Date: Jan 21, 2019 15:37:33 IST