Wednesday, 28 January 2009

Satyam ‘sale of parts’ ruled out – for now

(By Anthony Miller). Satyam’s new board dampened expectations that the company would be split up and sold yesterday, saying that this would be contrary to its mandate. However, they didn’t seem to rule out the possibility. The board has received expressions of interest both from trade and financial buyers. Meanwhile, Indian industrial conglomerate Larsen & Toubro trebled its stake in Satyam to 12%, fuelling speculation of a bid. L&T’s IT services arm, L&T Infotech, has been headed by ex-Wipro executive, Sudip Bannerjee since Sep. ’08.

Highlights of the board’s latest pronouncements include:
  • The appointment of Goldman Sachs and Avendus to advise on Satyam’s disposition.

  • The appointment of Boston Consulting Group as board and management advisors. Apparently they will not be charging Satyam for the work.

  • Confirmation that Jan. salaries will be paid and that employee numbers are indeed as reported. Funding discussions are near conclusion.

Ex-Nasscom president Kiran Karnik, now on the new Satyam board, said that some customers are discussing ‘risk mitigation’ plans while others are still issuing new work orders. The announcement of a new top team us still expected this week.

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