Abstract

The case examines how Grasim, a leading Indian business conglomerate, gained control over the cement business of another business group, L&T through stock market mechanizations. It discusses the rationale for Grasim’s acquisition of stake in L&T and also examines the acquisition tactics adopted by Grasim to increase its share in L&T. It covers the role of India’s stock market regulatory authorities in the issue with respect to insider trading at L&T, the open offer chaos and takeover code violations by Grasim. The case critically examines L&T’s decision to demerge the cement division to prevent a takeover by Grasim. The case explores the moves and counter moves adopted by both the companies in this tussle. Finally, it details the settlement plan accepted by both the parties.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Takeovers, management and shareholders.

Keywords

Grasim, Indian business, conglomerate, cement business, L&T, stock market, mechanizations, acquisition, stake, L&T, India's stock market, regulatory authorities, insider trading, takeover code, demerge, moves, counter move