BENGALURU: Former Cognizant president Rajeev Mehta will take over as the chief executive of Mindtree, the mid-tier IT services firm now controlled by engineering giant Larsen & Toubro.
Mehta, who had worked for two decades at Cognizant, joined L&T in April.
Another former executive of Cognizant, Debashis Chatterjee, was also among the contenders for the top job at Mindtree.
Mindtree founders — Krishnakumar Natarajan, NS Parthasarathy and Rostow Ravanan — who had announced to quit the company in early July, soon after L&T turned its promoter with a 60.06% stake, served their last working day on Wednesday. They remain shareholders in the company.
Shares of Mindtree have fallen after L&T acquired the stake at Rs 980 a share and analysts have blamed the exit of the founders as well as the company’s weak first-quarter performance for this. Investors had punished the company for the drop in operating margins to 9% in the quarter, due to a one-time bonus to employees and increase in wage costs.
The stock closed at Rs 717.30 on Wednesday on the BSE.
L&T chief executive SN Subrahmanyan told investors last month that L&T had taken steps to improve the business as well as margins of Mindtree. Also, Mindtree chairman AM Naik had written to all its customers, assuring business continuity.
Mehta, who had worked for two decades at Cognizant, joined L&T in April.
A formal announcement on the Mindtree appointment is expected on August 2, people familiar with the development said. Emails to Mindtree and L&T remained unanswered at press time Wednesday.
Another former executive of Cognizant, Debashis Chatterjee, was also among the contenders for the top job at Mindtree.
Mindtree founders — Krishnakumar Natarajan, NS Parthasarathy and Rostow Ravanan — who had announced to quit the company in early July, soon after L&T turned its promoter with a 60.06% stake, served their last working day on Wednesday. They remain shareholders in the company.
Shares of Mindtree have fallen after L&T acquired the stake at Rs 980 a share and analysts have blamed the exit of the founders as well as the company’s weak first-quarter performance for this. Investors had punished the company for the drop in operating margins to 9% in the quarter, due to a one-time bonus to employees and increase in wage costs.
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The stock closed at Rs 717.30 on Wednesday on the BSE.
L&T chief executive SN Subrahmanyan told investors last month that L&T had taken steps to improve the business as well as margins of Mindtree. Also, Mindtree chairman AM Naik had written to all its customers, assuring business continuity.
( Originally published on Jul 31, 2019 )
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