Larsen & Toubro (L&T) has sought shareholders' approval to transfer its electrical and automation (E&A) business, which is largely a product business, to a subsidiary, associate company or to any other entity as a going concern.
In a communication to shareholders, the company said the decision was taken considering the challenges of operating the business as part of the portfolio of a predominantly project and construction company.
Last week, the company's board of directors gave its approval for the transfer of the business as part of the ongoing restructuring programme in the organisation. L&T said it initiated the process of developing a strategic plan for 2010-15 in September 2009.
The process had identified strategies and initiatives for each business unit, besides carrying out a detailed assessment of is portfolio, organisational structure and capital.
The assessment revealed significant opportunities across all business segments and the need to refine the business model to one that will facilitate growth through greater levels of empowerment and delegation, while retaining accountability. With the company plans focused on aggressive growth on a large revenue base, the management decided to restructure the company into various independent companies.
Keywords: L&T restructuring programme