Mindtree approves appointment of 3 L&T nominees as board directors

In the mid of an open offer process, Mindtree board on Thursday approved the appointment of L&T’s nominees as directors, which included the engineering major’s Chief Executive Officer (CEO) and Managing Director S N Subrahmanyan and its Chief Financial Officer (CFO) Ramamurthi Shankar Raman, among others.

In an exchange filing, the IT firm said its board had approved induction of five new directors into the company’s board, which will come for shareholders’ approval in its next annual general meeting on July 16. Apart from CEO and CFO of L&T, Jayant Damodar Patil, whole time director and senior executive vice-president for L&T’s defence business, will also be part of the firm’s board.

All the three L&T nominees will come as non-executive directors.

Apart from induction of non-executive director, two independent directors will also be part of the Mindtree board. Its nomination and remuneration committee has also approved appointment of Prasanna Rangacharya and Deepa Gopalan Wadhwa as independent directors. While Rangacharya is a legal consultant, who had served as a chief legal advisor of L&T between 1991 and 1998, Deepa Gopalan Wadhwa is a former diplomat.

While five new directors’ appointment will come for approval in the next board meet, Mindtree's co-founder and non-executive director Subroto Bagchi will not seek reappointment. “Subroto Bagchi, who retires by rotation at the 20th AGM on July 16, has not offered re-appointment for himself,” the filing said.

With this rejig, Mindtree’s board will now have 12 board members from eight.

Though Bagchi will step down from non-executive role, it was uncertain whether other three founders — Krishnakumar Natarajan, Rostow Ravanan, N S Parthasarathy — will also consider stepping down from the board in the future.

“There is a high probability that N S Parthasarathy may step down from the board, given the fact that his tenure is also going to be over soon. As far as Krishnakumar Natarajan and Rostow Ravanan are concerned, they are likely to continue to see through the transition,” a source said.

According to corporate governance officials, with such approval for induction, Mindtree board has shown maturity. “Today’s appointment shows that Mindtree board is no longer hostile to L&T. With this induction, the only thorny issue remains to be taken up in the AGM is the special dividend,” the official said.

Larsen & Toubro Limited