Satyam has buyout offers from Indian, foreign firms

NEW DELHI - The IT bellwether Satyam Computer Services, embroiled in a Rs.70 billion ($1.7 billion) financial scam, has received buyout offers from both domestic and foreign firms, its new board member Tarun Das said Tuesday.

‘Satyam has got enormous fixed, human resources and technology assets. It’s a very strong company. The board hasn’t yet discussed the issue of a lookout for a buyer,’ said Das, who is also the chief mentor of the Confederation of Indian Industry (CII).

‘But I have to truthfully say: We have been approached by potential buyers,’ he told reporters on the margins of a global investment conference here, adding the suitors that expressed interest included both Indian and foreign companies.

Das said the new board has already met twice and its priority was to ensure that a chief executive and a chief financial officer are appointed soon. ‘We’re again meeting on Jan 22-23 in Hyderabad. The priority is to keep the company going.’

Satyam is facing a major financial mess and a serious threat in continuing its operations because of the Rs.70 billion fraud, admitted two weeks ago by its founder and former chairman B. Ramalinga Raju.

Prime Minister Manmohan Manmohan Singh has said the scam was a ‘blot’ on India Inc’s image and that the government would unravel the plot and punish the guilty.

Das admitted that the company’s clients were concerned, but said the board members were talking to them over conference calls and assuring them that Satyam has some of the best talent in the country and would come out of the present mess.

He said one concern, however, was the legal hurdles that the company faced overseas. ‘We have looked at the legal issues which the company faces because of the class actions suits filed in America and have appointed legal advisors to deal with that.’

The Serious Fraud Investigation Office (SFIO), which is already probing the scam, has also started a probe into possible the nexus between Satyam and two other companies promoted by Raju - Maytas Properties and Maytas Infrastructure.

‘The inspectors investigating the matters relating to Satyam have informed us about the apparent nexus between the events that have taken place at Satyam and Maytas Properties and Maytas Infrastructure,’ Corporate Affairs Minister P.C. Gupta said.

‘I would like to say the government will leave no stone unturned to obtain full facts of the case, to ascertain the extent and nature of the irregularities that may have been committed relating to Satyam,’ he said. ‘The guilty will be punished.’