Fraud-hit Satyam gets nod for 51 pct stake sale

March 6, 2009
File photo of Indian software company Satyam's headquarters in Hyderabad

Fraud-hit Indian outsourcing firm Satyam on Friday said it had been given the green light to open a global bidding process to sell off a 51 percent stake in the company.

Satyam's government-appointed board said it would "initiate the process to invite expressions of interest" from bidders shortly, a statement said.

Satyam has been battling for survival since January when its founder B. Ramalinga Raju, now in jail, stunned the corporate world by declaring he inflated the firm's balance sheet by more than one billion dollars and fudged its profits for years.

Company shares surged 15.81 percent or 5.5 rupees to 40.65 in morning trade Friday on the Mumbai stock exchange.

Satyam says it wants to find a buyer soon -- even though it could be months before the full truth about the disgraced outsourcing giant's finances emerge.

Market regulator the Securities and Exchange Board of India has approved the sale of the stake in two phases.

The buyer would first acquire newly issued shares of the company representing 31 percent of its share capital.

The purchaser would then make an public open offer, mandatory under financial market regulations, to acquire another 20 percent of the firm, the statement said, raising its total stake in Satyam to 51 percent.

"Qualified investors are expected to have total net assets in excess of 150 million dollars," the statement said.

In line with Indian law, a lock-in period of three years will prevent the investor from selling these acquired shares, the regulator said in the statement.

(c) 2009 AFP

Explore further: China search giant Baidu sees lift from travel deal

Related Stories

China search giant Baidu sees lift from travel deal

October 30, 2015

Chinese search giant Baidu said Thursday it expects a new travel services partnership to help drive future revenue as the country's middle class grows, after it reported better-than-expected third quarter earnings.

Saudi tycoon raises stakes in Twitter

October 7, 2015

Saudi tycoon Prince Alwaleed bin Talal and his Kingdom Holding Company announced Wednesday they have increased their stake in Twitter Inc to become the firm's second-largest shareholders.

China travel firms in share-swap deal: Bloomberg

October 26, 2015

Two of China's largest online travel firms have agreed to a share swap and partnership deal to create the country's biggest Internet travel service, Bloomberg News reported Monday.

Recommended for you

Glider pilots aim for the stratosphere

November 20, 2015

Talk about serendipity. Einar Enevoldson was strolling past a scientist's office in 1991 when he noticed a freshly printed image tacked to the wall. He was thunderstruck; it showed faint particles in the sky that proved something ...


Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.