Tech Mahindra claims Satyam in Bid

Tech Mahindra

Tech Mahindra was the highest bidder for Satyam, with a 58 rupee($1.16)  per share bid, for 31 percent of the company, Satyam said on Monday.

The offer beats a bid from the Indian engineering firm Larsen & Toubro, which already owns a 12 percent stake in Satyam.

Tech Mahindra, is a joint venture between British Telecom and the Indian conglomerate Mahindra & Mahindra, stands to win control of Satyam Computer Services after a bid that values the fraud-damaged company at $1.2 billion. Tech Mahindra will later make an offer for an additional 20 percent of Satyam’s shares on the open market, which will give it a controlling stake price.

Satyam’s board chairman said, “The selection of the highest bidder, in a fair, open and transparent process, signals a new stage for the company in its progress towards stabilization and growth”.

The American vulture investor Wilbur Ross and Cognizant Technologies also did due diligence on Satyam, though was unclear if they made a bid for the company.

Satyam was one of the India’s largest Information Technology(IT) companies, with more than 50,000 employees and a market capitalization of over $7 billion, before one of the company’s founders said in January he had faked about $1 billion in cash and inflated the company’s operating margins.

Satyam serves as the back office and information technology provider for hundreds of the world’s largest companies, including Nestlé and General Electric. The Indian government took control of the company and pushed through a quick sale, in order to prevent losses in the country’s $71 billion outsourcing industry.

Indian investigators have since said that more than a dozen people in the company’s finance department were involved in the fraud, including a team who churned out fake invoices and bank statements.

Satyam

Tech Mahindra, which provides Information Technology services to the telecom industry, has less than half the workforce of Satyam. The deal would bring Tech Mahindra business in new industries from manufacturing to financial services.

Tech Mahindra closed at Rs 359.45, up by 12.31 per cent on the Bombay Stock Exchange today.

Anyway the new revolution is made on Satyam Company may reflect a possitive solution to its Client as well as Employees.