Suspension of trading in shares of Mindtree on account of merger with L&T Infotech

Trading Announcements
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Mindtree Limited on November 14, 2022 received approval from National Company Law Tribunal (NCLT) for its merger with L&T Infotech (LTI). Mindtree has announced November 24, 2022 as the record date to determine the shareholders who will be eligible to receive the shares of L&T Infotech. You can check the announcement from the company here.

As a result, the shares of Mindtree will be suspended from trading from November 23, 2022 onwards and you will not be able to see these in holdings on Kite.

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As per the scheme of amalgamation, shareholders of Mindtree will receive 73 shares of LTI for every 100 shares held in Mindtree.

Any fractional entitlements will be cash-settled and the amount will be directly credited to your primary bank account.

When will I receive shares of L&T Infotech?

The credit of shares can take between 30 - 45 days from the record date. You’ll receive an email from CDSL once the shares are credited to your demat account.

When will the allotted shares start trading on the exchanges?

After the credit of LTI shares, the company will have to take approval from the exchanges to list and start trading in the newly allotted securities.

What will be the average price for allotted shares of L&T Infotech?

The average price of allotted LTI shares will be calculated as follows: Invested value in Mindtree / The number of LTI shares received including fractional shares.

For example, if you had invested in 10 shares of Mindtree at a price of Rs. 3000, the invested value will be Rs. 30,000.

If you receive 7.3 shares of LTI, the average price will be Rs. 4,109.58 (30,000 / 7.3).

The fractional shares are cash settled, and the amount for these will be directly credited to your primary bank account as and when the trustee appointed by the company sells the shares.

When will I receive the amount for fractional entitlement?

If there is any fractional entitlement, the equivalent amount will be directly credited to your primary bank account after the trustee appointed by the company sells the shares.

As explained here.

All the fractional entitlements shall be consolidated and allotted to a trustee authorized by the Board of the Amalgamated Company who shall sell the shares at such time(s) and at such price(s) on the stock exchange, as such trustee deems fit, and shall distribute the net sale proceeds, subject to tax deductions and other expenses as applicable, to the members of the Amalgamating Company in proportion to their respective fractional entitlements.

What if I hold less than 100 shares of Mindtree?

Even if you hold less than 100 shares of Mindtree, you will receive an allotment of LTI shares.

For example, if you hold 3 shares of Mindtree, your allotment comes at 2.19 shares (3 x 0.73). 2 shares will be credited to your demat account. 0.19 will be fractional and the amount for this will be credited to your primary bank account.

Impact of the merger on F&O contracts

All existing F&O contracts of Mindtree (November 2022, December 2022, and January 2022 expiry) will expire on November 22, 2022, and will be physically settled.

Also, no new F&O contracts will be introduced for trading. You can check the announcement from the exchange here.

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From my understanding, if I own less than 100 shares of MINDTREE, I won’t get any LTI share then, and everything will be cash settled?

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even if you hold 2 shares of Mindtree eod November 22, you will get 1 share of LTI after about 8-10 working days and cash credit of 0.46 fractional share after about 45-60 days .

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I own 59 shares of MINDTREE. Since they are less than 100, will I get an equivalent LTI share after the merger, or will I get cash funds instead?

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Have explained this above:

Since you’re holding 59 shares, you’re eligible for 43.07 shares of LTI (59 x 0.73), 43 shares will be credited to your demat account, while for the remaining 0.07 will be fractional and amount for this will be credited to your primary bank account.

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Ah, thank you. I was a little confused.

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Official respone from Zerodha support (Ticket #20221117138276)

:confused:

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Hi @StupidSoldier, sorry about this. Will have this checked.

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Ok please let me know which one of you is saying the truth,

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What Shubh59 has said is true.
It has happened to me once.

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I have future position in Mindtree. Recently, a merger has been announced with LTI and subsequently I received an email from NSE, snippet of which is as below:

The existing contract will expire on 22nd November 2022, However, new strikes would be introduced in the existing contract months if required. Accordingly, no contract shall be available for trading in the above mentioned security with effect from Nov 23, 2022 onwards.

Please can someone explain in simple words how my position will be dealt with? Should I exit my positions with losses?

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Futures and Options contracts of Mindtree will expire on November 22nd and will be physically settled, ie. you will have to give or take delivery of underlying shares upon expiry.

Also, no new F&O contracts will be introduced as Mindtree is being suspended from trading.

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I have 2 shares of mindtree , what will happen to my shares after merger ? As mindtree will get deslisted .

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you will get 1 share of LTI in next 8-10 working days PLUS you will get cash credit of 0.46 fractional share after about 45-60 days .

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I have 1 share of mindtree. How much amount will i recieve? Will i recieve the same amount when i purchased the share or is there a possibility of loss? Also by when will i recieve the amount in my bank account

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for your 1 share of Mindtree you will get cash credit 0.73 fractional LTI …all such fractions are transferred to a trust appointed which wiil combine them and sell at nse/bse . net money received from broker will be given to erstwhile fraction holders. this process may take unto 60 days . price depends on date when the trust sell this shares of LTI …

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Dear
I have 20 share of mindtree how much share i will get and when credited to my zerodha accound please let me know

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Hy @Basayya_Hiremath

Since you have 20 Shares your eligible for 14.6 shares of LTI. Therefore 14 shares will be credited to your demat account, while for the remaining 0.6 will be fractional and amount for this will be credited to your primary bank account.

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I have 21 share of mindtree how much share i will get and when credited to my accound please let me know

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You’ll be eligible to receive 15.33 shares (21 * 0.73), the 15 shares will be credited to your account in 30-45 days from the record date. The remaining 0.33 will be fractional and payment for this will directly be credited to your bank account once the shares are sold by the trustee appointed by the company. Please check the main post for more details.