New Delhi: Satyam Board is believed to have laid down some basic norms for the winner of the bid, including no sale of the company’s assets for three years, not to pledge them to raise debt, no sudden lay-off of employees and should have enough cash on hand to infuse immediately.
These are the mainframe of the Requests-For-Proposal (RFP) among others that the Board sent to the registered bidders on Friday night.
Chairman of the Board Kiran Karnik told PTI, “We have sent RFP to all the registered bidders. The board is taking all steps to do it (stake sale) as soon as possible...we are on track with our internal deadline.” He refrained from revealing the time-line set by the board, though sources said deadline could be anytime in April.
Meanwhile, the bidders are also getting their act together to reply to RFP. iGate chief Phaneesh Murthy is in India presumably to see the process himself though the company said it is his routine visit.
According to a bidder, who has signed up, the Board has made it clear that the legal cases (and expenses) against Satyam (in US) will be the responsibility of the winner.
The bidder said the essence of RFP appears to eliminate fly-by-night players, who would acquire the company to make a quick buck at a later stage. At Friday’s share price, the company was valued at Rs3,066 crore. The cost of the US lawsuits, according to a bidder, could be between $400 million and $700 million.
A buyer is likely to be in place next month, said a source in the know of the development.
The Satyam Board that met last week said it has received adequate response from Indian and international bidders, including PE firms.
The company has asked the potential bidders to formally respond to RFP by 20 March, along with proof that their net worth was at least Rs1,500 crore - one of the eligibility criteria for the bidders. Satyam said once this was done, interested bidders will be provided data and information regarding the company to enable them to submit technical and financial bids.
Going by that, shortlisted bidders could emerge by March- end, after which the financial bids will be submitted. A due diligence, which is the access to the data room, will be provided after 25 March only to the shortlisted bidders.
Tech Mahindra, L&T and B K Modi’s Spice Corp have registered among a number of PE firms. The Satyam Board said it has got ‘adequate´ response from the bidders.