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L&T open offer has impacted growth, not strategy: Mindtree

The Bengaluru-headquartered IT services firm crossed $1 billion in revenue in the just concluded fiscal year.

, ET Bureau|
Apr 30, 2019, 06.40 AM IST
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Ravanan said Mindtree had been working on its large deals team for a few years.
BENGALURU: Mid-tier IT company Mindtree said L&T’s ongoing takeover attempt has impacted business growth, with FY20 revenue expected to grow in the ‘lowteens’, although the hostile offer had not affected the company’s strategy “We see a strong demand environment, we have forecast growth in the ‘low teens’ but there are some macro-economic issues that we are watching. The L&T open offer doesn’t affect our strategy, but it does affect our business growth,” Mindtree CEO Rostow Ravanan told ET in an interview.

The Bengaluru-headquartered IT services firm crossed $1 billion in revenue in the just concluded fiscal year, an inflection point for companies expecting to win large deals because of their bigger balance sheet.

The company had seen large deals in its pipeline, but had not changed its strategy, Ravanan said, declining comment on whether the company would have forecast higher growth rates if the takeover attempt had not been made.

As more companies chase large deals, Indian IT services companies have begun beefing up the pursuit teams for such deals by bringing in people with prior experience in stitching up big deals.

These deals, which are multi-year engagements, come with their own set of risks, such as the need to adequately price the project.

Ravanan said Mindtree had been working on its large deals team for a few years.

“We have had a large deals team in place for a couple of years. It has solution leads and a few shadow team members who have other roles but contribute to this as well,” Ravanan said. “We are continually refining our playbook of going after large deals.”

Mindtree’s large deals team is headed by its executive vice president and head of enterprise service lines, Kamran Ozair. The company will selectively add new clients, as it believes mining existing customers is a better way to grow, Ravanan said.

“We have always said that customer acquisition is a very expensive proposition. Once we get the customer, we focus on growing that business,” he said.

The IT company’s $1 billion revenue milestone was somewhat overshadowed after L&T bought long-time Mindtree shareholder VG Siddhartha’s more than 20% stake in the company last month.

The engineering conglomerate is set to launch an open offer, which begins May 14 and ends on May 27, to give it majority control.
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