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Financial mismanagement charges see a dozen leaving L&T arm

The executives were from the upstream part

Kalpana Pathak  |  Mumbai 

Financial mismanagement charges see a dozen leaving L&T arm

About a dozen officials in L&T Hydrocarbon Engineering (LTHE), the oil and gas project implementation arm of Larsen & Toubro (L&T), have left the company after being charged with financial mismanagement. Its business is structured into three business groups — upstream, mid and downstream, and plant construction and pipelines. The executives were from the upstream part. In an e-mailed reply to a questionnaire, L&T said, “We have no comments on the matter.”

A senior executive from the company said, “Last month, LTHE asked over a dozen senior executives from the upstream segment to leave. The mismanagement pertained to the contracting of certain offshore marine project(s).” The official declined to give details of the project(s).

Company sources said it had instituted an inquiry into the matter and hired Ernst & Young to assess the level of damage. “E&Y has given a report, post which the involvement of the officials was revealed. It was a closely-guarded inquiry. However, this will not impact the ongoing projects that L&T has,” an official said.

LTHE’s upstream segment employs around 1,500 people. Sources said the division does not plan to recruit for filling the recently vacant positions. LTHE has operations across the hydrocarbon value chain in India and abroad, and has been looking at expanding its operations in West Asia/North Africa.

This August, L&T appointed Subramanian Sarma as chief executive and managing director of LTHE. He is also on the board of L&T as a non-executive director.

“With LTHE planning to expand in geographies beyond India, it becomes imperative for the company to have stricter internal controls,” the official added.

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First Published: Fri, October 02 2015. 00:07 IST