At his last annual shareholders’ meeting as the head of L&T group, A M Naik today made an oblique but strong reference to takeover bids by Ambanis and Birlas years ago and asserted that the engineering giant is only owned by the government, employees and public shareholders. “Excuse me, please listen. There is nobody else as a shareholder, neither Reliance nor Birla. This is totally owned by the Government of India and the employees. And of course one million shareholders like you. Please don’t talk out of turn,” Naik told a shareholder while addressing the group’s infotech arm LTI’s AGM here. The statement came as a retort to the mention of the late Dhirubhai Ambani by one of the shareholders who was trying to impress the longevity of his holding in the group since 1984, long before Reliance acquired L&T shares.
In 1987, the late Ambani had managed to wrest sufficient holding in the cash-rich L&T and then launched a hostile takeover bid in 1989.
However, political and other developments ensured Reliance becoming a passive shareholder. In 2001, it attempted to sell its over 10 per cent stake to Aditya Birla group’s Grasim, L&T’s competitor in the cement business. Naik, the then managing director and chief executive, strongly opposed any change in majority ownership and is said to have called upon the employees to work so hard that the higher stock prices dissuade any raiders.
Currently, the entire shareholding of L&T, which has a market value of nearly Rs 1.6 lakh crore, is classified as public. The major shareholders include the government (through SUUTI with over 4 per cent stake) and state run insurers that together have nearly 21 per cent stake. Individual retail investors also have close to 20 per cent stake in the company. Naik, 75, will be hanging up his boots on October 1 after putting in as many as 53 years and today chaired the last of three AGMs, which started with the flagship parent’s on Tuesday, where he had turned emotional.
“I take this opportunity of journeying back along the road I have travelled for 53 years, with special focus on the last 18 when I’ve been privileged to lead the company,” an emotional Naik, who joined L&T way back in 1965 as a trainee, had told the shareholders of L&T on Tuesday. At the LTI meet today, Naik said the infotech arm is targeting to hire over 1,300 on the current base of over 21,000 employees. The company is also negotiating to add a few more multi-million dollar clients whose billing can go up to USD 100 million, he said, adding moves are also on to do more acquisitions. The sixth largest software exporter has re-skilled up to 85 per cent of its employees to make them ready to work on the newer technologies, Naik said.