L&T Komatsu
Larsen and Toubro (L&T) and its Japanese partner Komatsu, which are manufacturing hydraulic equipment in joint venture, are reportedly in the final stages of negotiations in a stake sale deal in which L&T is selling its 50% stake to L&T Komatsu involving about Rs. 600 to Rs. 700cr investments. The deal in question excluded the land in Bangalore on which L&T Komatsu's manufacturing plant is located as the Indian player is keen to use the land to build residential and commercial properties. The diversified conglomerate has already rolled out its first real estate project in the south — L&T South City in Bangalore, said an industry insider, adding that L&T Realty owns 1,200 acre across the country and the proposed deal signals the Indian firm's desire to exit non-core businesses at a time its core engineering and construction operations are undergoing severe stress.

According to sources, the Japanese partner is understood to have agreed on the transaction now as it seeks to expand its presence in India. It teamed up with L&T in the mid-90s soon after the liberalization unfolded opportunities in fields such as mining. The joint venture company posted gross sales of Rs 1,615cr during the last fiscal. In fact, over 50 per cent of L&T's order inflows and 49% of its order book for the nine months ended December 2012 trickled from infrastructure including construction of roads, bridges, buildings and factories, which is also the main reason for L&T managing a 12.5% y-o-y growth. In view of this, the player managed more than double the share of infrastructure 10 years ago and the share of process, power and hydrocarbons has dwindled largely due to global meltdown. In the recent past L&T has also sold businesses such as a tractor joint venture with John Deere and a ready-mix concrete business to Lafarge, besides exiting its 17.5% stake in Bangalore airport project.