Fraud-hit Satyam gets nod for 51 pct stake sale

Mar 06, 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: Samsung delays Tizen smartphone sales launch

add to favorites email to friend print save as pdf

Related Stories

Vodafone profit warning as sales drop

May 20, 2014

Vodafone's annual profit rocketed to £59.3 billion, boosted by the sale of a stake in US joint-venture Verizon Wireless and despite more problems in Europe, the British mobile phone giant said on Tuesday.

Recommended for you

Amazon launches 3D printing store

1 hour ago

Amazon announced Monday the launch of an online store for 3D printed items to allow consumers to customize and personalize items like earrings, pendants, dolls and other objects.

Samsung delays Tizen smartphone sales launch

6 hours ago

Samsung Electronics said Monday it would postpone the roll-out of its new smartphone based on Tizen, a home-grown operating system aimed at breaking away from Google's Android system.

Chinese portal Sohu reports $45 million loss

9 hours ago

(AP)—Sohu.com Inc., operator of a popular Chinese Internet portal, said Monday it lost $45 million in the latest quarter while revenue rose 18 percent to $400 million.

User comments : 0