Satyam Gets Sebi

Satyam Computer Services Ltd, currently being investigated for the biggest fraud in India's corporate history, on Friday said it has received Sebi approval to sell 51 per cent of its stake through a global bidding process.

The selected investor will have to acquire the stake by purchasing 31 per cent equity via a preferential sale of new shares and subsequently make an open offer for a minimum 20 per cent, Satyam said.

Satyam further said that the investor will make an open offer for 20 per cent on the closure of the subscription. The investor will be issued additional equity if it fails to get 51 per cent post the open offer, the management said.

The company will come out with details of the bidding process shortly, it said.

Meanwhile, the news had a positive impact on the Satyam stock, which jumped nearly 14 per cent on the NSE and 13.14 per cent on the Bombay Stock Exchange. It was later trading at Rs 38.50, up 9.69 per cent, on the NSE, and at Rs 39.50, up 12.54 per cent, on the BSE.

While B K Modi of Spice Corp was unavailable for comment, Hinduja CFO Prabal Banerjee told PTI once the bidding process details come out, the company will examine the possibility of bidding.

"This is a positive step ... In the right direction, giving clarity to the broad contours of the situation," Banerjee said. Tech Mahindra Vice-Chairman and Managing Director Vineet Nayyar said the firm needs time go through the details of Satyam's statement.

"The company expects to invite expressions of interest from qualified investors shortly in a global competitive bidding process," Satyam said.

Qualified investors are expected to have total net assets in excess of $150 million, it said.

Satyam's government-appointed board is gearing up to sell stake in the company to restore investor confidence and check client defections.

IBM, the global IT major, is reportedly interested in the company but the IBM spokesperson earlier said the firm does not comment on speculation. Other prominent players in the race to acquire Satyam are Larsen & Toubro (L&T), which owns 12 per cent in the Hyderabad-based company, Tech Mahindra, BK Modi-owned Spice group, and the Hinduja group.

Modi had earlier said that the stock market valuation could not be the basis for setting a reserve price for the sale of the troubled IT firm.

Analysts said in the absence of proper financial data and legal complications, getting the right bidders may be little difficult but it all depends on the details of the process laid out by the company.

Satyam's founder Ramalinga Raju said in January that he inflated assets by over $1 billion, which resulted in the stock plummeting 80 per cent, pushing the company into uncertainty.

(PTI)

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