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L&T in parleys for acquisition in US

Rumi Dutta

Larsen & Toubro, India's largest engineering company, has initiated talks with process engineering companies in the US for acquisition.

The move is part of a blueprint being inked to evolve the company into a multinational engineering, procurement and construction major.

L&T director K Venkataramanan said, "At present our focus is to establish a strong base in the global market. We are seriously looking out for process engineering companies in the US which will provide us a quick penetration into the US as well as European markets."

As part of the plan, L&T is also weighing its options on a possible listing overseas, may be at the New York Stock Exchange. But a decision on the US listing has yet to be finalised by its board.

A consultant to advise L&T on the overseas acquisition is likely to be appointed soon. The investment on such an acquisition would be around $50-60 million, Venkataramanan added.

Meanwhile, with a thrust on exports, L&T has opened warehouses in the US. Besides the US, the Middle East, the Far East, UK and Europe have been identified as focus markets.

L&T, post-identification of the EPC business as its core operation, has drafted a comprehensive package to enhance its turnover three-fold from Rs 80 billion to Rs 250 billion over five years. As part of the recast, its cement business will be hived off and a strategic partner will be roped in.

The company is also in the process of integrating its ECC and E&C divisions. According to analysts, this will enhance L&T's acquisition appetite and enable it to compete in the global markets.

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