Larsen & Toubro (L&T) has decided to put the sale of its subsidiary L&T Valves on the backburner. The company will instead focus on the initial public offering (IPO) of its IT subsidiary.

As part of its strategy to exit non-core areas, the infrastructure major was earlier planning to sell stakes in certain units including L&T EWAC Alloys and L&T Valves. It had mandated Citigroup to scout for buyers and was expecting L&T Valves alone to fetch about $700 million.

L&T is now hoping to mop up the funds through the IPO of L&T Infotech.

“L&T has now decided to put the stake sale of L&T Valves on the backburner as it now wants to concentrate only on the forthcoming IPO of L&T Infotech. The company expects the IPO to be a resounding success,” a source close to the development told BusinessLine .

It intends to take a call on the stake sale in L&T Valves only after the IPO, he added.

In September, L&T Infotech had filed initial papers with market regulator SEBI for an IPO. According to the Draft Red Herring Prospectus, L&T will sell 1.7 crore shares (10.85 per cent of the share capital) as part of the issue. Citigroup Global Markets India, Kotak Mahindra Capital, ICICI Securities and Barclays Bank are managing the issue.

When contacted, an L&T spokesperson declined to comment.

L&T’s wholly-owned subsidiary L&T Valves, which has manufacturing facilities in Chennai, Coimbatore and Kancheepuram, makes flow-control solutions for the oil & gas and power sectors. In 2013, L&T had acquired a 50 per cent stake in Audco India from US-based Flowserve Corp to strengthen its valves business.

The company was also looking to sell its stake in another wholly-owned subsidiary, L&T EWAC Alloys, which is into maintenance and repair welding, and has a factory in Ankleshwar, Gujarat. Its products and services include consumables, specification grade electronics and flux-cored welding wires.

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