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Spice firms up plan for Satyam buy
Rajesh S Kurup in Mumbai | February 02, 2009 15:16 IST
Firming up plans to acquire 51 per cent stake in scam-tainted Satyam Computer Services [Get Quote], industrialist B K Modi-controlled Spice Group is sending a team to start negotiations.
The team will meet Sebi officials on Monday and Satyam's new board during the week to convey its intention to acquire the stake through an auction process.
Separately, the country's largest diversified business group Hindujas has also expressed its intention to acquire controlling stake in the IT company.
"We have firmed up our plans to acquire a majority stake in Satyam and a team from the group will meet Sebi officials on Monday to discuss the issue. We will request the regulator to auction shares of the company and stress that the proceeds should be pumped back into the company's operations," Spice Corporation Chairman B K Modi told Business Standard.
"We will seek an auction process. Apart from being transparent, it will also help in roping in the highest bidder," he added. The group was planning to acquire the stake through Spice Innovation, its New Delhi-based holding company, and was ready to shell around Rs 2,000 crore (around $400 million).
The team comprises top officials of the group and merchant bankers, even though Modi is not on the team. It will also meet the new board members, which is meeting on February 5 to finalise the new chief executive officer and chief financial officer, to discuss the acquisition.
"If Satyam needs to raise Rs 2,000 crore (Rs 20 billion), the company should offload an equivalent amount of shares. This (the percentage of stake to be offloaded) has to decided by the company's board," he added. Modi, however, did not comment on the basis of which the group will value the beleaguered IT company.
Meanwhile, a top official from Hindujas said that the group was interested in acquiring Satyam and has alerted its investment bankers. "We are waiting for some clarity on the issue, like what are the company's financials, including losses and debts. This will emerge only after the board meetings and we will put in a proper bid, once there is transparency in the whole issue," the official said.
Engineering and construction major Larsen&Toubro, Tech Mahindra [Get Quote] and Essar (interested only in the BPO arm) are among the other suitors for Satyam.
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