Satyam Computer Services has found a new home in Tech Mahindra. It will pay Rs 58 a share, or a premium 23% premium over Friday’s close, to acquire a 31% stake in Satyam. That speaks for Satyam’s value even after all the fudging of books or for Tech Mahindra’s desire to acquire Satyam. Either way, it’s an outcome that will please Satyam’s shareholders, board and the government itself. The shareholders got a good price, the board has managed the sale process without any glitches and the government would be happy that it remains in Indian hands.
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Satyam sale enters final stage today
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The board is expected to open financial bids on Monday submitted by a few bidders remaining at the last stage. Among them are believed to be Tech Mahindra, L&T, Cognizant Technologies and some private equity funds. If the gap between the first and losing bids is less than 10%, then there will be open auction. The highest bidder in the auction will be declared the new owner.
Filed under: Companies, Information Technology, Top News, Ramalinga Raju, Satyam, Satyam Scam, Scam
Will Pfizer India make an open offer to Wyeth’s shareholders or will the two merge?
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Pfizer is acquiring Wyeth for $68bn in a cash and stock transaction. Both companies have listed subsidiaries in India, Pfizer Limited and Wyeth Limited. The first point of interest for Indian shareholders will be whether this will result in an open offer for Wyeth. It will not, because the transaction has been styled as a merger agreement, in which Pfizer will pay the consideration in cash and stock. Under the Sebi Takeover regulations, an acquisition by way of merger will be exempt from the compulsory open offer clause.
Filed under: Finance+Markets, Top News, Markets International, Regulatory, Sebi
Oil PSUs get Rs 21,942 crore bonds
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The government yesterday issued bonds worth Rs 21,942 crore to the oil marketing companies to compensate for the losses incurred by them. IOC got about 54% of the total bonds while BPCL was issued nearly a fourth and HPCL the rest. These bonds have a coupon of 6.9% and mature in 2026. Since the oil marketing companies have little leeway in fixing prices of petroleum products resulting in losses, especially on the sale of kerosene and LPG.
Filed under: Companies, Oil & Gas, Top News, Bonds, Oil Marketing Companies, Subsidy
Oil PSUs to spend 2% of net profit on CSR
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The petroleum ministry announced that public sector units in the oil sector –like Gail, HPCL, ONGC, BPCL and IndianOil- have resolved to spend at least 2% of their net profits on corporate social responsibility projects. There was a joint meeting of the Minister for Petroleum & Natural Gas, Murli Deora, chairmen of oil PSUs and the petroleum secretary, RS Pandey.
Filed under: Companies, Oil & Gas, Top News, Companies Disclosures, Corporate Governance, Corporate Social Responsibility, Policy From the Government
RBI’s credit policy stands still
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The Reserve Bank of India announced its third quarter review of the monetary policy today, disappointing the rate-cut hopefuls by leaving all key benchmarks unchanged. In the past few months, the central bank has provided enough leeway, by reducing interest rates and adding to cash in the banking system, for banks to start lending again.
Filed under: Economy+Policy, Top News, Credit Policy, CRR, Interest Rates, Markets Debt & Forex Markets, RBI, SLR
Vedanta to delist Madras Aluminium (Malco)
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Vedanta Resources Plc has decided to delist Madras Aluminium Company (Malco). The Anil Agarwal promoted Vedanta owns 80% of Malco’s equity and has sent a proposal to its board to approve a delisting proposal under Sebi’s delisting guidelines. It will have to make an offer to Malco’s shareholders through a reverse book-building process. It will set a floor price while shareholders will be free to offer shares at a higher price. The price determined through the book-building process will be the final price, which Vedanta is free to accept or reject. Continue Reading →
Filed under: Companies, Top News, Economy International, M&A, Malco, Sterlite, Vedanta
Siemens’ IT unit SISL sold at low valuation
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Siemens Information Systems Ltd (SISL) seems to have been sold at a relatively cheap valuation, by Siemens, to a privately owned company of Siemens AG. Siemens said that SISL, which had revenues of Rs 994 crore and PBT of Rs 73 crore for the year ended September 2008, has been valued at Rs 449 crore.
Filed under: Companies, Top News, Siemens, SISL, Valuation
Sun Pharma requests a judgement from Israel’s Supreme Court
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Sun said, in a SEC filing, it has extended the tender offer closing date from Jan 9 to Jan 30. It also said that it has informed the Supreme Court that its negotiations to reach a settlement have been unsuccessful. It is now awaiting the court’s decision in the matter. The dispute concerns the price at which Sun will acquire Taro’s shares from promoters and minority shareholders. Initially, Sun had offered $7.75 a share, which it then hiked to $9.50 a share, but Taro responded first with an offer to conduct a shareholder referendum to decide the price. Continue Reading →
Filed under: Companies, Top News, Companies International, M&A, Open Offer, Sun Pharma, Taro
Satyam’s shocking admission: revenues, profits and cash inflated
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Satyam Computer Services is staring at a big hole in its books, due to falsification of accounts over a number of years, by its promoters. Even as the seriousness and extent of the problem will emerge over the next few weeks, the company could even be staring at bankruptcy, unless a quick bailout is arranged.