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Satyam to pay overseas Feb salary in 2 parts

February 03, 2009 17:57 IST

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Employees of Satyam [Get Quote] Computer in India will be paid their February salaries by the month-end, while its employees overseas will be paid in two tranches beginning mid-February, a top source said.

"February salaries of Satyam employees abroad would be paid in two tranches--the first by February 15 and the second by this month-end, while India salaries would be paid by the end of this month," the source said.

Around Rs 500-600 crore (Rs 5-6 billion) is needed per month to meet salary payment requirements, the source added.

When asked how the scam-hit company would meet this and other financial requirements, the source said that Satyam's financial position was not very bad, as it had around Rs 1,800 crore (Rs 18 billion) as receivables.

"Satyam's financial position is not bad, as it has receivables of around Rs 1,800 crore. This gives the company a certain comfort level," the source said, adding that about 55-60 per cent of this is receivable from abroad.

However, hidden liabilities, if any, are as yet unknown.

"While Satyam's financial position is not bad, much depends on how fast we can recover them (receivables). The other point is if there are any hidden liabilities, they are yet to be ascertained," the source said.

While salaries to employees take around Rs 500-600 crore, there are other expenses as well such as insurance, arrears to vendors, dues to provident fund, TDS and rentals. The rentals are, however, primarily overseas, the source said.

Creditors are flocking Satyam, asking for their payment arrears, the source said, adding, "if the arrears can be cleared, then the company can live on its own."

One major advantage Satyam enjoys is the huge land-bank it possesses.

"Satyam has got huge unencumbered assets in the form of a land-bank. Along with the Satyam Training Centre, it has around Rs 1,500-to 1,700-crore (Rs 15-17 billion) worth of property in Hyderabad which can be mortgaged to raise funds," the source said.

"If necessary, we will mortgage the land to raise funds," the source added.

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