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Tuesday, Oct 26, 2004

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L&T looking for acquisitions in engg services, hydrocarbons

Our Bureau

Mumbai , Oct. 25

LARSEN & Toubro (L&T) is aggressively scouting for acquisitions, particularly in the engineering services sector.

"With a debt equity ratio of 0.28, we can considerably leverage this for acquisitions," Mr Y.M. Deosthalee, Chief Financial Officer, L&T, said, after a quarterly results news briefing here today.

Apart from engineering services, the hydrocarbon area — upstream, mid-stream, and downstream — is of interest to the company, he said.

"We have to identify gaps in our competencies and fill them up," he said.

An enabling resolution for inorganic growth, by way of approving rising of debt, in principle, has already been made, he said.

The group is also looking for a partner, domestic or global, in its holding company, L&T Holdings, under which several special purpose vehicles have been floated for various projects that L&T is executing.

"We are looking for a good partner — financial or strategic — but the partner must have the long-term in view," said Mr Deosthalee. "Through that, we only want to invest in projects that L&T wants to participate in."

It has not been decided what equity stake in L&T Holdings would be offloaded to the partner, but L&T will definitely be the majority partner, with at least 51 per cent of the equity.

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