Satyam to outline stake sale process soon: Karnik

Satyam to outline stake sale process soon: Karnik
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First Published: Sun, Feb 08 2009. 01 02 PM IST
Updated: Sun, Feb 08 2009. 01 02 PM IST
New Delhi: The board of Satyam Computer Services would soon define the process for inviting proposals from prospective buyers, its newly appointed chairman Kiran Karnik has said.
The former Nasscom president, who put on the mantle of Chairman at a time when the scam-hit firm is passing through one of its worst phases, told PTI, “Our investment bankers, Goldman Sachs and Avendus, will shortly define the process of the first stage - inviting proposals from the suitors, which will be transparent and investor friendly.
“Only after that (will we) be in a position to look at those proposals, whether they are meeting our criteria...”
Karnik further said, “There has to be a transition from the Government-supervised company status to a professionally- run company. The transition should be smooth and transparent. That will give a lot of comfort to both investors and employees. It is key priority.”
He went on to add that a number of buyers had shown interest by sending their proposals, while some were waiting for a formal process to begin. “So, we have to first put the process of inviting those who are interested in the company,” Karnik said.
He said at the moment Deloitte and KPMG were engaged in carrying out the restatement of accounts, but how long that could take it was difficult to say.
“They (the auditors) have to go back several years to see where the funds came from, where and since when they were (being) diverted, the exact amount of revenue and so on... That’s not an easy task and is likely to take time,“ he said.
The man who guided the Indian IT industry through the outsourcing backlash said there were short- and long-term challenges for the fund-starved company.
“The first problem is financial. There has to be enough funds in the company (giving) comfort to the employees and investors. About Rs600 crore worth of funds have been committed by the banks. But we want a continuous and sustainable source of revenue. Fortunately, the receivable position is good,” he added.
Spice Corp has put forth its expression of interest to the board. L&T has over a 12% stake in the firm. Market regulator Sebi has said it will amend the takeover regulations to allow easier acquisitions in special cases like Satyam.
The Satyam board has already proposed to Sebi to relax the current open offer pricing norms for L&T in view of the financial fraud admission by the disgraced Satyam promoter B Ramalinga Raju on 7 January, which forced the share prices to tumble by over 80% cent.
However, on positive feedback, shares of Satyam soared by 6.81% in intra-day trade on Friday and ended with a gain of 2.49% at Rs47.40 on the BSE.
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First Published: Sun, Feb 08 2009. 01 02 PM IST
More Topics: Satyam | Karnik | Chairman | Stakes | L&T |