Takeover as a Strategy for Conglomerates

In the present time, corporate restructuring has become an important component in the overall decisions of the company. Reorganization of a company’s operations that could be either financial or operational is called corporate restructuring. A company proposes to restructure its structure for various reasons. Some of those reasons include getting a synergetic effect, eliminating competition, increasing efficiency, etc. The takeover is one of the strategies of corporate restructuring. Takeover can be interpreted as a process where one company gains control over the other company either directly or indirectly. This paper will talk about how certain companies in India plan to take over the target companies as a strategy to attain growth and profitability in their business. This paper will in particular talk about the hostile takeover by an acquirer of a target company. The paper will mention the hostile takeover of Mindtree Ltd by L&T Ltd.. The paper will illustrate all the steps taken by L&T to acquire Mindtree Ltd. and the reasons for the acquisition. The paper will also illustrate the due procedure as laid down under SEBI Substantial Acquisition of Shares and Takeover Regulation), 2011 . Further, the paper will also illustrate the opposition made by the promoter of Mindtree Ltd. and the steps taken by them to prevent this hostile takeover. Lastly, it would also mention the mistakes made by Mindtree Ltd. which led to its hostile takeover