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Strategic investor to be picked in 6-8 weeks, says Satyam newsletter

Strategic investor to be picked in 6-8 weeks, says Satyam newsletter
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First Published: Thu, Feb 26 2009. 12 37 AM IST
Updated: Thu, Feb 26 2009. 12 37 AM IST
Hyderabad: Fraud-hit Satyam Computer Services Ltd is likely to find a strategic investor within eight weeks, the company’s staff were informed by an internal newsletter.
“It is likely that the answer to who is the strategic investor and further details surrounding this will emerge from a competitive, fair and transparent method in 6-8 weeks,” said the newsletter, updating staff on efforts by the government-constituted board to sell a stake in the company.
The government dismissed the board of Satyam and replaced it with a six-member board after founder B. Ramalinga Raju confessed on 7 January to having cooked the company’s books to the tune of Rs7,136 crore over several years.
Raju, his brother B. Rama Raju and former chief financial officer Srinivas Vadlamani are being held in a Hyderabad jail.
The company newsletter said the board had discussed guidelines and procedures for inducting an investor, adding that moves towards securing regulatory approvals were in an advanced stage.
It said the board is looking for strategic investor “who has a strong reputation, financial capability and sufficient funds.” “The intent is to progress in a swift manner, but the intricacies of diligence and the need for confidentiality with bidders will need due consideration and time,” it said.
The new board has sought to reassure clients and staff, raise money for working capital, appointed new auditors to restate accounts and worked towards attracting a strategic investor who could take a significant stake and management control of Satyam.
KPMG and Deloitte Touche Tohmatsu were hired to restate the accounts and investment bankers Goldman Sachs Group Inc. and Avendus Capital Ltd. to find a strategic partner.
International Business Machines Corp., the world’s largest computer services provider, and Larsen & Toubro Ltd, India’s largest engineering firm, are the leading contenders to to buy Satyam, Global Equities Research Llc. said in a report on Tuesday, according to Bloomberg.
c.sukumar@livemint.com
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First Published: Thu, Feb 26 2009. 12 37 AM IST