Satyam gets SEBI nod to sell 51 pc; suitors seek more detail

New Delhi, Mar 6 (PTI) NYSE-listed Satyam Computer
Services, currently under probe for one of the biggest
corporate frauds in the country, Friday received SEBI nod to
sell 51 per cent stake in the company through a strategic
partner and will initiate bidding process shortly.

Securities and Exchange Board of India (SEBI) has
approved an international bidding process that would allow a
strategic investor to acquire up to 51 per cent stake in the
company. Expression of Interest from investors would be
invited shortly, said a company statement Friday.

Satyam shares surged 18 per cent to Rs 42.10 on SEBI nod.

"The bidding process will begin shortly," Satyam's
government-appointed director Deepak Parekh said here.

The SEBI nod propped up the company's shares but possible
suitors want more information to take a call, with Tech
Mahindra, Hinduja and L&T seeking more details on the process
and valuation prior to making a move on bidding.

Spice group said it is ready to bid but wants 51 per cent
stake and immediate management control.

The strategic sale would involve two processes -- first,
the selected investor would be issued fresh equity of 31 per
cent stake, and then a mandatory open offer of 20 per cent of
the company's share capital would have to be made, which would
be made at the same share price as the price paid by the
investor for the subscription.

Hinduja group CFO Prabal Banerjee said the company can
take a decision on bidding only after getting some more
information.

However, AV Birla group chief Kumaramangalam Birla, who
met Corporate Affairs Minister Prem Chand Gupta Friday said
his company is not interested in bidding for Satyam.

Among other norms for bidding include that qualified
investors should have net assets in excess of USD 150 million,
and that the investor will not be allowed to sell any equity
share acquired for a period of three years from the date of
acquisition.

The Government-inducted board of Satyam is pushing for
the sale of the company, as it faces potential client loss. On
January 7, its former chairman B Ramalinga Raju confessed to
have inflated accounts of the company for over seven years,
leading to a fraud of Rs 7,800 crore. This landed the company
into disgrace and uncertainty.

If post closing of the open offer, the investor fails to
acquire 51 per cent through subscription and open offer, the
investor would have the right to subscribe to additional fresh
equity shares, enabling the investor to acquire 51 per cent
stake in the company.

Larsen and Toubro, the largest single shareholder in
Satyam Computer, said it would wait for the details of the
bidding process and financial figures before taking any
decision on bidding.

"The statement of Satyam today is elementary. We will
have to study the documents and then decide what to do next.
We have to know how they (Satyam) are going to evaluate the
company," L&T Chairman A M Naik said. L&T holds 12 per cent
stake in the company.

Spice Corp Chairman B K Modi said, "We are ready to bid
for Satyam. We want 51 per cent stake and immediate management
control." He said not more than five per cent of the stake
could be mopped up from open offers and SEBI has done the
right thing by allowing fresh equity shares to the investor,
thus taking the stake to 51 per cent.

Another interested company, Tech Mahindra, also said it
needs more information from Satyam to take a call on bidding.
PTI ANA