SEBI has authorized Satyam to sell up 51 pc stake to a bid winner. Following which, Satyam has begun the procedure to select a bidder by inviting for EoI’s from interested companies.
Bidders would have to submit their Expression of Interests (EoI) with a proof of availability of Funds to the tune of INR 1500 crore indicating the funds required to buy and run Satyam for a medium term. Though there is no base price mentioned for bidding, the amount can go up to INR 1000 Cr. After shortlisting the bidders, these individual companies would get access to critical information like Accounts and Legal, which may help them to conduct Due Diligence.
The Stock Market has reacted postively to this step. Already a few companies have made it clear they want Satyam to in their strides including Larsen & Tubro, Tech Mahindra, Spice Group, Fujitsu etc. IBM, which was reportedly interested for a while now has pulled out of the bidding process. This move is reasurring for its 40,000 strong workforce that they would finally see an end to their delima.
Some of these companies want the freedom to revise their bids after more information on diligence are shared. Their fear is well justified. What if they find something which is unviable?for their company?