"Tech Mah gets M&M, BT's nod to participate in Satyam bid"

Source: Moneycontrol

Five pm on Thursday marked the deadline for filing Expression of Interest (EoI) in the fraud hit Satyam Computer Services Limited. The Satyam board is in a meeting today and, probably, they will take a decision on whether or not to make the names of the registered parties public. Tech Mahindra has got permission from its stakeholders M&M and British Telecom (BT) to register for the bid, while iGATE has also expressed an interest in the company.

Here is a detailed report by CNBC-TV18's Research Analyst Raja Rajeshwari. Also watch the accompanying video.

The board meeting is under way and all the board members are present. We believe that they are discussing the registered parties who put in EoI on Thursday.

CNBC-TV18 knows of only four names, but there could be more. Now, Satyam is taking a decision on whether or not to make the names public. So we will have to wait and watch.

Right now, we have seen a mixed bag of reaction coming in on Satyam stock itself because we have seen a significant amount of build up taking place. There has been correction today. The general sense coming in from the market is that they haven’t seen any big MNCs coming to the fray and a little disappointment is prevailing in.

CNBC-TV18 spoke to Tech Mahindra earlier in the day that said that they have got permission both from their stakeholders. However, they are not looking at any fund raising plans as of now or taking a PE on board. They will use the cash lying with their stakeholders––M&M and BT––for showing that they have Rs 15,000 cash in hand. That is how all of these four bidders are placed right now.

It would be interesting to see what iGate has to say, what they are going to do in terms of cash positions in hand because iGate even at start, it was told that they would be looking at the PE from going along with them. So the PE firms who do they align with will be an important thing to watch out for. So as for today we will wait and watch for those names becoming public and the step 2 will be cash limits and proper expressions of interest which needs to be put before March 20, 2009; the 5 pm deadline and from there the ball will roll.

Phaneesh Murthy, CEO, iGATE, speaking on the Satyam bid, said, “We continue to be concerned about the probability of significant value erosion at Satyam. However, our interest to pursue this transaction is subject to the evaluation of the financial position of Satyam and the extent of its possible value erosion.” He added, “Since the board of Satyam had put a deadline, we filed our Expression of Interest. We still believe that it is a long shot for us to consummate this transaction in its current form.”