Neutron Naik does not want to talk about the Birlas. The managing director and CEO of Larsen & Toubro has a photo album open before him, with pictures of submarines, missile launchers and the like - and he’d rather talk about how L&T plans to manufacture all of them, now that the company has the government’s go-ahead.
When we insist on talking about the Birla takeover, he looks up from a picture of a particularly lethal looking piece of equipment that he’s been describing.
“This not a new thing for L&T,” he says, vexedly tapping his fingers on the table. “Reliance tried the same thing many years ago.”
Welcome to the bunkers of India’s most macho company. Peopled with red-blooded engineers who have spent their careers building bridges and gigantic chemical plants.
Equipped with 56 strategic business units and 23,000 employees, but where the heroes are still the construction guys, who work night and day at the sites to complete projects in record time.
Where all seven executive directors on the board - except for CFO YM Deosthalee - are operations men who have spent 30 years or more with the company.
What’s the feeling here about the possibility of joining the Aditya Birla group? What’s the cultural fit going to be like?
When he bought the first chunk of L&T shares from the Ambanis, Kumar Mangalam Birla visited Henning Holck-Larsen at his home in Mumbai to explain his intentions. The 97-year-old founder is reported to have responded to the young Birla’s gracious gesture by promising his wholehearted support.
The support of L&T’s highly regarded Chairman Emeritus will surely stand Birla in good stead. But since Larsen’s personal holding in L&T has been whittled down to barely one per cent since he founded the company, it will count for little if it comes to a show of numbers.
Which brings us to L&T’s other defining characteristic: the total separation of management and ownership. L&T growth through infusions of public capital embodies the business principles in developed economies like the US, where corporates like General Motors and GE eventually grew rapidly through investors’ funds, even as their original promoters diluted their share holding and let management pass into professional hands.
