S N Subrahmanyan to succeed AM Naik as L&T chairman next year
27 August 2016
Larsen & Toubro's deputy managing director and president S N Subrahmanyan will take over as the next chairman of the engineering and construction giant after A M Naik retires on 30 September 2017 after over five decades at the helm.
Naik on Friday introduced Subrahmanyan, 55, as his successor to shareholders at the company's 71st annual general meet. "He will be taking things forward. Ask your questions to him," Naik said.
"There's no doubt that he will succeed me from October 1, 2017," Naik said.
Subrahmanyan had started his career with Larsen & Toubro in November 1984 as a project planning engineer.
The septuagenarian chairman has been mentoring Subrahmanyan to become the face of the company for some time now. It is not clear what title Naik will hold once he relinquishes his executive duties. There will definitely be a chairman at the company, Naik had said in the past. On Friday, Naik declined to comment whether he would continue with the company as a non-executive chairman after September 2017.
Succession at the $16-billion L&T has been hitting the headlines for a long time amid speculation whether Naik will ever retire from the company he joined as a junior engineer way back in 1965. Naik became the company's managing director and chief executive in the summer of 1999 and subsequently became its chairman and MD in 2003.
In the past, whenever the succession issue cropped up, the company restructured leadership roles. It split the post of chairman and managing director in 2012, allowing Naik to continue as its chairman. Naik, a workaholic, has steered the company to great heights in terms of revenues and market capitalisation. On Friday, he announced an ambitious goal.
Naik, who is due to retire on 30 September 2017 said his priority is to make the company asset light and restructure small businesses so as to make the company agile and technology-driven.
"There is still so much to be done, but one thing is asset light and putting in top gear all the restructuring which is left of small businesses that are still part of L&T due to the bad world-wide market. They have to be sold or tackled strategically," he told reporters after the AGM.
The company is restructuring its projects division - L&T IDPL - and Naik hopes the process will be completed by March next year.
"In general insurance, we have sold the business and we hope it will go out (from the books) in the next 10 days.
''We have already sold Kattupalli port project that was asset heavy. Once we have finished restructuring the main ones, we will then look at selling the Nabha power project in Punjab," Naik said.
For the Nabha project, Naik said, the company will have to wait till the legal problems, claims and counter claims are resolved and it might take more than a year to get settled.
L&T is reportedly in talks with the Adani group to sell the project at an estimated value of around Rs3,000 crore.
Naik expressed confidence that with the economy starting to turn around, this target is achievable provided a right strategy and on-ground execution is in place.