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Satyam pauses for now

Views 3 Views    Comments 0 Comments    Share Share    Posted 16-12-2008  
Hyderabad 17 Dec 2008:Satyam Computer Services Limited will acquire Maytas Properties immediately following the deal announced in Hyderabad on Tuesday. Satyam will acquire 31 per cent from the promoters and make an open offer for an additional 20 per cent from the public in the case of Maytas Infra.

While the price proposed to be paid to Maytas Infra promoters is Rs 475 per share, the price for the open offer has been approved to be Rs 525 per share and is subject to change in line with Sebi regulations.

Maytas Properties has a land bank of 6,800 acres, while Maytas Infra is into power, roads, ports and airports. It has recently bagged a 71-km metro rail project in Hyderabad.

An official of Reliance Mutual Fund, a shareholder in the IT company who did not want to be named, said that the deal was “going to destroy the image of India as a major investment destination, if such things are allowed.” The shareholders would seek to oppose the deal at whatever level possible, he added.

Satyam’s shares at the New York Stock Exchange plunged to its 52-week low of $5.43 within minutes of market opening.

Satyam Computers chairman Mr Ramalinga Rajusaid it would be a “pause” before he scouts again for other properties.

Terming the acquisition Maytas Properties and Maytas Infra as “purely business decision”, Mr Raju said “they are promoters related companies.” “As far as Maytas Properties is concerned we are essentially making sure that he (my son) would not be part of the team...," Mr Raju said.

Mr Raju said that the decision was purely based on valuation, which in the present day scenario is at low levels, and rejected suggestions that the acquisition was essentially to bail out the companies of his son.

On Maytas Infra, Mr Raju said that till the process of acquisition is completed in the next two-three months the present team would stay on at the helm.

Source:
http://www.dc-epaper.com/dc/dch/2008/12/17/index.shtml?ArtId=014_008&Search=Y
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