About six to seven firms have expressed interest in buying out fraud-hit IT major Satyam Computer Services. The firms in the fray include BK Modi’s Spice Group and engineering giant Larsen & Toubro (L&T). Others in the race include Indian and global firms, and also private equity buyout funds. Though L&T’s interest in Satyam is known as it has increased the stake in the IT firm to 12% through open market, Spice Group is a new entrant. Its chairman BK Modi has said that Spice Innovation is interested in acquiring a 51% stake in Satyam and has already put in a formal bid, reports HinduBusinessLine.
L&T Chairman A M Naik has also written to finance ministry for a management control of Satyam, reports Business Standard. L&T already has 12% stake, and if its stake goes above 15% it will trigger an open offer. In last one week Satyam’s shares have gone up from Rs 28 to nearly Rs 54 due to the interest expressed by various parties, especially L&T. Other parties who have shown interest in Satyam are iGate, Tech Mahindra and HCL Technologies.
Satyam’ new board has recently appointed Goldman Sachs and Avendus as investment bankers to look at various options.
The valuation of the company is also hard to put at this time as the full extent of the fraud is yet to come out. Also the impact due to the loss of clients is yet top be determined.
In another development, Company Law Board (CLB) has given legal immunity to the new Board of Satyam from the fraud committed by the past management. The new CEO and CFO will also get this immunity.