L&T completes Divestment of the Electrical & Automation Business to Schneider Electric

“L&T completes Divestment of the Electrical & Automation Business to Schneider Electric”

Highlights:

1.       The divestment deal announced in May 2018 has been completed after receiving the requisite regulatory approvals and fulfilment of necessary conditions

2.       L&T continuously evaluates its business portfolio and takes capital allocation decisions from a long-term perspective

3.       Its exit from the Electrical & Automation Business is a part of the strategic portfolio review process

4.       About 5,000 employees of the E&A business will become part of Schneider Electric’s global family

5.       The manufacturing facilities of E&A in Navi Mumbai, Ahmednagar, Vadodara, Coimbatore and Mysuru in India and related subsidiaries in UAE, Kuwait, Malaysia and Indonesia are also being transferred to Schneider Electric

6.       The subsidiary in Saudi Arabia, L&T Electrical & Automation Saudi Arabia Company Limited (LTEASA), will be transferred to Schneider, once the requisite regulatory approvals are in place

7.       L&T, over the past five years, in line with its strategy to focus on the EPC and Services business, has exited several businesses. The divestment is in line with L&T’s stated goal of unlocking value for future growth and this deal with Schneider Electric will further strengthen the balance sheet

This strategic divestment is in line with L&T’s stated goal of unlocking value
for future growth

 Larsen & Toubro (L&T), India’s leading engineering, technology, construction and financial services conglomerate, today announced the closure of the strategic divestment of its Electrical & Automation (L&T E&A) business to Schneider Electric, a global player in energy management and automation.

The significant and complex divestment deal, one of its kind in India announced in May 2018 has been completed after receiving the requisite regulatory approvals and fulfilment of necessary conditions. The divestment is in line with L&T’s stated goal of unlocking value for future growth. L&T continuously evaluates its business portfolio and takes capital allocation decisions from a long-term perspective. Its exit from the Electrical & Automation Business is a part of the strategic portfolio review process.

Commenting on the closure of this divestment, Mr. A.M. Naik, Group Chairman, Larsen & Toubro said: “The closure of divestment of the E&A business is a key milestone in our stated long-term strategy. The challenge was to carve out a business of this scale, with minimum disruption to the sprawling customer base and do it all amid the constraints of a pandemic. We believe Schneider Electric is the right partner to grow the business, that L&T had nurtured and grown over decades. We truly believe that this deal with Schneider Electric is a win-win for our employees, business partners, and shareholders.”

Mr. S. N. Subrahmanyan, CEO & MD, Larsen & Toubro said: “This all-cash deal will help us create a much stronger balance sheet, thereby creating long-term value opportunities for our stakeholders by focusing on key aspects of business. The deal was a complex M&A transaction involving slump sale of the domestic business and share purchase transfer. This is in sync with our strategy to look at L&T in broadly three areas, EPC Construction & Projects, Manufacturing & Defence and Services.”

L&T’s E&A business with its wide range of low and medium voltage switchgear, electrical systems, industrial and building automation solutions, energy management systems, metering solutions and projects and services business are transferred to Schneider Electric. Schneider Electric will use related brand insignia for a specified period as the brand is very popular and has a strong brand recall in the switchgear market.

About 5,000 employees of the E&A business will become part of Schneider Electric’s global family. The manufacturing facilities of E&A in Navi Mumbai, Ahmednagar, Vadodara, Coimbatore and Mysuru in India and related subsidiaries in UAE, Kuwait, Malaysia and Indonesia are also being transferred to Schneider Electric. In view of the pending local approvals, the subsidiary in Saudi Arabia, L&T Electrical & Automation Saudi Arabia Company Limited (LTEASA), will be transferred to Schneider, once the requisite regulatory approvals are in place.

L&T, over the past five years, in line with its strategy to focus on the EPC and Services business, has exited several businesses. The recent divestment of its stake in ports, insurance, road concessions and other businesses have all unlocked value and this deal with Schneider Electric will further strengthen the balance sheet.

Shardul Amarchand Mangaldas (SAM) Legal Advisors, Ernst & Young (EY) LLP and Arpwood Capital acted as advisors to L&T on this transaction. 

Mr. Subramanian Sarma Inducted as

Mr. Subramanian Sarma Inducted as Executive Director

on L&T Board, Mr. S V Desai & Mr. T Madhava Das elevated

The Board of Directors of Larsen & Toubro (L&T) at its meeting held on July 11, 2020, decided to induct Mr. Subramanian Sarma, Non-Executive Director on the Board, as an Executive Director and elevate Mr. S V Desai and Mr. T Madhava Das to the Board. The slew of Board level appointments reflects L&T’s resolve to chart an aggressive future in its businesses.

Mr. Sarma is at present CEO and MD of L&T Hydrocarbon Engineering, a wholly-owned subsidiary of L&T. In his new role, Mr. Sarma will be designated Whole-Time Director & Sr. Executive Vice President (Energy). Effective August 19, 2020, he will hold Board level responsibility for L&T’s Power business, in addition to his current responsibility in the Hydrocarbon business.

Mr. Desai and Mr. Madhava Das are both members of the Company’s apex-level Executive Management Committee and have been elevated to the Board with immediate effect.        Mr. Desai has been designated Whole-Time Director & Sr. Executive Vice President (Civil Infrastructure) and will be responsible for the Heavy Civil Infrastructure and Transportation Infrastructure businesses. Mr. Madhava Das will be designated Whole-Time Director & Sr. Executive Vice President (Utilities) and will be responsible for the Power Transmission & Distribution and Water & Effluent Treatment (WET) businesses.

Commenting on the board appointments, Mr. S N Subrahmanyan, CEO & Managing Director, L&T said: “Internationally, the hydrocarbon and power businesses are generally viewed as a cluster, and L&T will now adopt the same integrated strategy. Mr. Sarma’s experience and business insights especially in the intensively competitive Gulf markets are going to add great value to our Energy thrust. Both Mr. Desai and Mr. Madhava Das bring to the Board their expertise and competence across diverse fields both in the domestic and overseas markets, that will add a cutting edge as we look to take our Company’s business to the next level. We require a global vision with a strong local orientation. All these colleagues have proven their worth in extremely testing circumstances and are well-equipped to take on the added responsibility of steering the future course of their respective businesses.”

Mr. Subramanian Sarma, designate Whole-Time Director & Sr. Executive Vice President (Energy) said: “L&T’s power business has carved a niche for itself as an EPC player backed by strong, indigenous manufacturing capability that covers the full spectrum – boilers, turbine generators and balance of plant. The team has done well, given the circumstances. I am looking forward to the challenge of handling an integrated ‘Energy’ portfolio encompassing both hydrocarbon and power. Given the excellent track record of L&T and its subsidiary L&T Hydrocarbon, I am sure that we will be able to make a positive impact on the industry while ensuring that the company meets its growth objectives.”

Mr. S V Desai, Whole-Time Director & Sr. Executive Vice President (Civil Infrastructure) said: “It is a great honour and I am conscious of the enormous responsibility of leading these businesses at a challenging time in the Company’s history. L&T has done pioneering work in building some of the country’s largest and marque Infrastructure projects. We will continue to be Nation-builders. Given the institution’s capabilities and inherent strengths, I am confident that we will do well, and ensure that we realize our true potential.”

Mr. T Madhava Das, Whole-Time Director & Sr. Executive Vice President (Utilities) said: I have always believed that one of the pillars that L&T is founded on is meritocracy and this honour of being inducted on to the Board is a reflection of that value. L&T has done unique work both in power transmission distribution and in urban rural electrification works. We have taken Power & Water Infrastructure to the hinterland of the country and have brought the essentials of water and light to many citizens of the country. These two businesses have developed a significant footprint in the GCC, ASEAN and Africa. I look forward to the challenge ahead. I am fortunate to have a fine team, and all of us re-dedicate ourselves to take the Company’s interests forward.”

Brief profiles of the board appointees:

Mr. Subramanian Sarma, designate Whole-Time Director & Sr. Executive Vice President (Energy) is a graduate in Chemical Engineering, Mr. Sarma completed his Masters from IIT Bombay. A seasoned professional, he has over 37 years of experience, with 28 years being in the Middle East. During his career span, Mr. Sarma has handled the complete Oil & Gas value chain including Executive Management, Business Development, Project Management and Process Engineering. He has established L&T Hydrocarbon Engineering as a leading provider of Oil & Gas and Petrochemical services in India, Middle East and Africa. Mr. Sarma is the recipient of the CHEMTECH CEW, Business Leader of the year 2017 for Engineering Services. Immediately before joining L&T, Mr. Sarma served as Managing Director of Petrofac - Onshore Engineering & Construction, with complete responsibility for all the company’s onshore projects worldwide. Mr. Sarma joined the Board of the Company on August 19, 2015.

Mr. S V Desai, Whole-Time Director & Sr. Executive Vice President (Civil Infrastructure) is a civil engineer with Post-Graduation from IIT Madras. He started his career in 1986. Beginning his journey with L&T in 1997, he has served as Head-Contracts (Buildings & Factories), Head-Procurement & Contracts (Delhi International Airport), Segment Head – Integrated Projects, Segment Head – Metros, Business Unit Head of Metros & Defence BU till his present position as Head – Heavy Civil Infrastructure IC in a 23-year association with the Company. He has extensive experience in bid estimation, finalization of large value projects like Riyadh & Doha Metros and other Joint Ventures. Riyadh and Doha Metros are some of the largest contracts executed by L&T in a Joint Venture and successfully taken forward.

Mr. T Madhava Das, Whole-Time Director & Sr. Executive Vice President (Utilities) a graduate in Electrical Engineering from NIT Calicut and MBA from XIM Bhubaneswar, joined L&T in 1985 and has held various key positions in the electrical business of L&T-ECC such as Regional Projects Manager (Hyderabad Region), Sector Projects Manager – UAE & Chief – Business Initiatives & Contracts (Transmission Lines (TL)). He was instrumental in expanding tower manufacturing capacity by setting up a plant in Pithampur and in modernizing other manufacturing units. Subsequently, he headed the TL business in India and later moved to GCC as Head of the International (Cluster – 1). He assumed his present position in 2014 and under his leadership, the domestic Power Transmission, Substation, Distribution and the PT&D business in UAE, Saudi Arabia, Oman & Kuwait have grown significantly, besides moving to new geographies in ASEAN & Africa. He has also successfully incubated the Solar business besides adding microgrid & energy storage capabilities making PT&D as one of the largest transmission and distribution EPC businesses.

L&T Achieves Major Milestone in

L&T Achieves Major Milestone in Manufacturing Cryostat for Global Fusion Project     

Dignitaries Flag-off Final Assembly of the Cryostat to ITER, France

“L&T Achieves Major Milestone in Manufacturing Cryostat for Global Fusion Project”.     

Also attached is the “Backgrounder on LT's Role in Building ITER”.

Highlights:

·         Larsen & Toubro flagged-off the most complex and final assembly of Cryostat, the largest stainless-steel, high-vacuum pressure chamber in the world.

·         This is an important milestone in the global nuclear fusion arena as well as a moment of pride for the Make in India initiative.

·         The Cryostat assembly referred as the Top Lid, weighing 650 MT (metric tons), is to be installed with other Cryostat segments for ITER (International Thermonuclear Experimental Reactor) in a Reactor pit in southern France.

·         L&T has already delivered the Base section, the Lower Cylinder and the Upper Cylinder for the Cryostat.

·         The Cryostat’s function is to provide cooling to the fusion reactor and to keep very high temperatures at its core under control.

Key dignitaries and L&T officials present at L&T’s Hazira Manufacturing Complex were:

·         Dr. Bernard Bigot, Director-General, ITER Global

·         Mr. K.N. Vyas, Chairman Atomic Energy Commission, India

·         Mr. U.K. Baruah, Project Director, ITER‐India

·         Mr. V.K. Saraswat, Member, NITI Aayog

·         Mr. A.M. Naik, Group Chairman

·         Mr. S.N. Subrahmanyan, CEO & MD, L&T

·         Mr. Adil Zainulbhai, Independent Director

·         L&T, Mr. S.N. Roy, Whole-time Director, L&T and CEO & MD, L&T Power

·         Mr. M.V. Satish, Whole-time Director & Sr. EVP (Buildings, Minerals & Metals),

·         L&T, Mr. J.D. Patil, Whole-time Director & Sr. EVP (Defence & Smart Technologies), and

·         Mr. A.V. Parab, EVP & Head, L&T Heavy Engineering

The heavy engineering arm of Larsen & Toubro, India’s leading engineering, construction, technology, manufacturing and financial services conglomerate, has flagged-off the most complex and final assembly of Cryostat, the largest stainless-steel, high-vacuum pressure chamber in the world. This is an important milestone in the global nuclear fusion arena as well as a moment of pride for the Make in India initiative.

The flag-off ceremony took place in the August virtual presence of Dr. Bernard Bigot, Director-General, ITER Global, Mr. K.N. Vyas, Chairman Atomic Energy Commission, India, Mr. U.K. Baruah, Project Director, ITER‐India, Mr. V.K. Saraswat, Member, NITI Aayog, Mr. A.M. Naik, Group Chairman, Mr. S.N. Subrahmanyan, CEO & MD, L&T, Mr. Adil Zainulbhai, Independent Director, L&T, Mr. S.N. Roy, Whole-time Director, L&T and CEO & MD, L&T Power, Mr. M.V. Satish, Whole-time Director & Sr. EVP (Buildings, Minerals & Metals), L&T, Mr. J.D. Patil, Whole-time Director & Sr. EVP (Defence & Smart Technologies), and Mr. A.V. Parab, EVP & Head, L&T Heavy Engineering at L&T’s Hazira Manufacturing Complex.

Commenting on this occasion, Dr. Bernard Bigot, Director-General, ITER organization said, “Today, in Hazira, we celebrate with you the completion of fabrication of all the segments of the Cryostat, including most recently the segments of the Cryostat Lid — again achieved under these challenging conditions. The ITER Project and ITER-India were very fortunate to have Larsen & Toubro as our partner and the primary contractor for Cryostat fabrication…(as) the challenge of the Cryostat was unique.”

Commenting on this achievement, Mr SN Subrahmanyan, CEO & MD, L&T said, “This is a proud moment for the company, as it has completed another milestone in the development of world’s largest stainless-steel, high-vacuum pressure chamber. The company has used innovative and digital manufacturing techniques to ensure uninterrupted supply of high-quality, high-precision assemblies to ITER. This will further pave a way for the installation of Cryostat at the project site in France and eventually lead to the demonstration of large-scale feasibility of fusion power. It has empowered India to tread towards Atma Nirbhar Bharat by acquiring knowledge in this highly specialised field of science and technology.”

The Cryostat assembly referred as the Top Lid, weighing 650 MT (metric tons), is to be installed with other Cryostat segments for ITER (International Thermonuclear Experimental Reactor) in a Reactor pit in southern France. L&T has already delivered the Base section, the Lower Cylinder and the Upper Cylinder for the Cryostat. The Cryostat’s function is to provide cooling to the fusion reactor and to keep very high temperatures at its core under control.

Mr Anil V. Parab, Executive Vice President and Head, L&T Heavy Engineering said “With the supply of the Top Lid sector, we have successfully completed our India scope of the project ahead of the schedule. The fabrication of these components has been an engineering marvel both in terms of its massive size and its stringent quality standards. This is a proud moment for L&T Heavy Engineering, which is showcasing Indian capabilities in the high technology arena at the global stage.”

   

The project scope for L&T Heavy Engineering is divided into three aspects. Firstly, the company was to manufacture assemblies at its state-of-the-art Hazira manufacturing complex. The second aspect involved constructing a temporary workshop at the project site in Cadarache, France for the assembly of various sectors. And finally, it is to integrate the Cryostat with the Tokamak Reactor building. With this flag-off, L&T Heavy Engineering has completed the manufacturing work planned in India.

L&T’s Heavy Engineering business won this prestigious contract from ITER India, a wing of Department of Atomic Energy, for the ambitious mega scientific project, conducted in collaboration of seven elite countries including India and with a project outlay of around $20 billion.

L&T Heavy Engineering has state-of-the-art, fully integrated, world-class manufacturing facilities at Hazira (Surat), Powai (Mumbai) and Vadodara. The Heavy engineering business of L&T has a proven track record of supplying technology-intensive equipment and systems to global customers in Refinery, Oil & Gas, Petrochemicals, Fertilizers and Nuclear Power industries.

The virtual flag-off ceremony at Hazira manufacturing complex was attended by officials from Niti Ayog, ITER, India, ITER global, DAE, Rajiv Gandhi Science & Technology Commission, NPCIL, AERB and BARC joining through digital platforms.

L&T Construction Converts Healthcare

L&T Construction Converts Healthcare Units

into COVID-19 Care Facilities

The Building & Factories business of L&T Construction has transformed established or under-construction healthcare units into COVID-19 care facilities across India. The construction arm of Larsen & Toubro, with its mission-oriented and fast-track approach, turned around large-scale healthcare infrastructure into COVID-19 care facilities in the cities of New Delhi, Champaran and Madhepura in Bihar, Puducherry, Diamond Harbour in West Bengal and Gorakhpur in Uttar Pradesh.  

The company has the capability to construct 300 bed hospitals in record three to four months. It is capable of quickly turning around existing or under-construction medical infrastructure into COVID-19 related facilities and transform large establishments like marriage halls, schools and hotel rooms quickly into isolation wards.

Commenting on the development, Mr. M V Satish, Whole Time Director and Senior Executive Vice President (Buildings, Minerals & Metals), L&T said, “We have ace engineering and construction capabilities, yielding a fast turnaround of healthcare infrastructure for COVID-19 care. This is another contribution from the stable of Larsen & Toubro to India’s fight against COVID-19 as the company believes in serving the nation through thick and thin. We will continue to accelerate our efforts to aid governments in providing prompt relief to citizens through critical healthcare infrastructure.”

“Apart from L&T group’s ₹150 Crore donation to the PM Cares Fund, looking after the welfare of 160,000+ workmen at our various work sites and contributing in cash and kind to several States for welfare, L&T has also provided medical aid worth about ₹40 crore comprising of PPEs, N95 masks, diagnostic kits and other medical equipment. Our hospitals business unit has been empowering several government agencies to build much needed healthcare infrastructure during this pandemic,” added Mr Satish. 

The company has been delivering transformation of the following healthcare facilities:

JIPMER, Phase-III, Puducherry: 

The modernization of the old hospital and institute buildings has been done by L&T, while expansion of SS block and setting of screening OPD set up at JIPMER, Puducherry has also been achieved. The SSB Annexure block which was designed and constructed by L&T and handed over to JIPMER in 2019, was modified to meet the requirements of the state of Puducherry to treat COVID-19 patients. In the first floor, 50 beds were converted as isolation wards and another 100 beds in the second floor were converted into a special ward. Though the project is still not fully handed over to JIPMER, this fully completed super specialty block was immediately put into use.

Safdarjung Hospital, New Delhi: 

Three floors of the L&T-constructed 850-bed super specialty, Safdarjung Hospital, have been converted for the care of COVID-19 patients at the request of the Ministry of Health & Family Welfare, Govt. of India in March 2020. As the number of positive cases and those needing medical treatment have increased, more portions of the hospital are being converted for COVID-19 care including the IPD block of Zone1. 75 beds on the 1^st & 2^nd floors have been converted into Isolation wards; in Zone 2, 425 beds on the 1^st, 2^nd & 3rd floors been converted into Special and General wards to diagnose and treat COVID-19 patients.

Indira Gandhi Hospital, New Delhi 

At the request of PWD, Delhi, L&T offered 200 beds of the half-completed 700-bed Indira Gandhi Hospital at Sector 9, Dwarka, as a quarantine facility. The entire ground floor and the first floor of the OPD block with 200 beds have been made operational in extremely quick time.

Govt. Medical College and Hospital, Champaran, Bihar

L&T has handed over the ground and first floors of the Government Medical Hospital in Champaran, Bihar to accommodate 150 beds as isolation wards to treat COVID-19 patients. The conversion took just 10 days for the L&T team amidst the nationwide lockdown. It includes an emergency ward with necessary lighting and toilet facilities, a medical gas piping system, a curtain track system, a temporary septic tank, temporary power supply from the Electricity Board and a separate RCC approach road especially for the COVID-19 block.

Govt. Medical College & Hospital, Madhepura, Bihar:

L&T is constructing the Government Medical College with an intake capacity of 100 students per annum and a 500-bed college-affiliated hospital for the Bihar state government. As per the request by the State Government, L&T is modifying a block of the medical college into a COVID-19 testing lab. This state of the art BSL-3 level lab will help the state government to tackle COVID-19 cases more efficiently.

West Bengal Medical College, Diamond Harbour, West Bengal:

In Diamond Harbour, West Bengal, L&T is designing and constructing a Government Medical College for West Bengal State Govt with an intake capacity of 100 students per annum. As per the request of the State Government, L&T is modifying a block of the medical college into a COVID-19 testing lab. This state of the art BSL-3 level lab will help the state government tackle COVID-19 cases more efficiently.

AIIMS Gorakhpur, Uttar Pradesh:

In AIIMS Gorakhpur, L&T is designing and constructing a Government Medical College with an intake capacity of 150 students per annum and a 750-bed Hospital for the Ministry of Health & Family Welfare, Govt. of India. At the request of the State Govt, Uttar Pradesh, L&T is modifying a block of the medical college into a COVID-19 testing lab which will again hasten the COVID-19 testing process.