Mumbai: The chairman and managing director of Larsen and Toubro Ltd, A.M. Naik, and chief financial officer and board member Y.M. Deosthalee stayed away from Friday’s media meet held after it posted third quarter earnings. Earlier this week, the duo spoke to analysts over a conference call, explaining L&T’s interest in fraud-hit Satyam Computer Services Ltd.
J.P. Nayak, president and a director, and R. Shankar Raman, executive president (finance), met the media on Friday. They said the focus will be only on L&T’s quarterly performance. Raman, however, spoke about money being kept in preparedness for growth. Edited excerpts of what they ended up saying on Satyam:
Will your investment in Satyam be drawn from this pool?
Actually yes. The Satyam investment of about 4% has gone through a subsidiary company L&T Capital and the next 8% was done through L&T. When we talk about a pool to invest we do take into account all businesses... But when we went to the market and raised money, I did not know that it will be used for this purpose.
What’s the total corpus kept for investing in Satyam?
There’s no specific money allocation for Satyam.
Will you provide for mark-to-market losses on your Satyam investment?
No. Our accounting convention states that all the current investments be marked to market but all strategic investments are reported at cost.
What is your total investment in Satyam so far?
About Rs650-670 crore.
When will you make a bid? How will you fund the acquisition?
What’s this? We were to confine this interaction to (L&T’s) financial results. As far as financing is concerned, we have the resources.
What was the response from market analysts?
We don’t ask for their response. They ask for information from us.
What was the feedback from other directors on the board?
We cannot give the details of what transpired in our board meeting.
What is the strategy behind this acquisition of Satyam stake?
What happens in the future on Satyam will be decided by the board of Satyam, not by us.
But won’t you have a basic strategy in place?
We don’t know what they are going to do.
Will you ask for management control?
We have not asked for anything in writing.
Was it communicated in some other way?
With the government, you have to give everything in writing.
Does L&T have any clarity on the liability of Satyam?
Your information and my information is the same. Whatever is in public domain, you know and I know.
Are you open to making an open offer?
Our decision will depend on what the Satyam board decides.
Have you sought relaxation from Sebi on open offer pricing for Satyam?
No, we have not asked for any advance ruling.
There is talk about Satyam owning 2,000 acres. Was that a consideration?
You are speculating now.
Can you explain the strategy behind the Satyam stake acquisition?
It is not clear to me (laughs).
When you’re investing Rs700 crore, shouldn’t you have a strategy in place?
You’ll have to ask Satyam on their plans. If you are asking about our strategy, I cannot share that with you.