Hyderabad: The Andhra Pradesh high court on Friday appointed Brahmaiah and Co. as an independent auditor to scrutinize the scheme of amalgamation for the merger of information technology services provider Mahindra Satyam and its parent company Tech Mahindra Ltd.

The auditor has got four weeks to complete its scrutiny and submit the report. The single bench headed by justice Sanjay Kumar had earlier queried the share swap ratio that had been arrived at.

“There is a need to find out whether the valuation for scheme of amalgamation had been conducted in a manner keeping the interests of minority shareholders," the judge said.

In November, a group of minority shareholders of Mahindra Satyam (the rebranded Satyam Computer Services Ltd) filed a petition in the Andhra Pradesh high court opposing the proposed share-swap ratio, among other things, for the merger with Tech Mahindra.

The petitioners asked the court to revise the swap-ratio of 2:17, that gives shareholders two Tech Mahindra Ltd shares for every 17 owned in Mahindra Satyam. The petitioners, however, did not oppose the merger.

The court had clubbed the merger petition filed by Mahindra Satyam and the minority shareholders opposition petition together.

A Mahindra Satyam spokesperson said the “matter is sub judice" and that it’s following the court’s instructions. He declined to comment further on the case.

“The court still needs to clarify on the scope of the auditor and matters related to costs involved," said Pushyam Kiran, counsel for Mahindra Satyam.

The boards of Mahindra Satyam and Tech Mahindra Ltd had approved the merger and the swap ratio.

Both BSE Ltd and the National Stock Exchange have already given their approvals for the merger. The Competition Commission of India (CCI) has also given its clearance.

The merger needs to be cleared by Andhra Pradesh high court and the Bombay high court, to form an entity that is expected to be the country’s fifth largest software firm with an annual revenue of about $2.4 billion.

Shares of Mahindra Satyam declined by 2% to 98.20 on BSE, while the benchmark Sensex was down 0.32% to 19,424.10 points.

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