Satyam banks on Goldman Sachs and Avendus for advice

Larsen & Toubro, which recently increased its stake in Satyam from 4% to 12%, has not ruled out pushing for more

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By  Vineetha Menon Published  January 28, 2009

Satyam has appointed Goldman Sachs and Avendus as its investment bankers while it considers offers from strategic investors and potential buyers.

Board member T.N. Manoharan said that the board has received ‘several proposals’ from companies and private equity firms but has ruled out splitting and selling parts of Satyam’s business, saying that it “would be contrary to the Indian government’s mandate regulating the company’s affairs as a going concern.”

US-based outsourcer iGate has expressed interest in buying Satyam with the support of private equity funding, while Larsen & Toubro, which recently increased its stake in Satyam from 4% to 12%, has not ruled out pushing for more.

L&T has already requested market regulator SEBI to relax a rule that sees any potential acquirer with a 15% stake in a target company to make an open offer to buy another 20% at not less than the average six-month stock price. L&T believes this will force them to pay a much higher price than Satyam’s current share value.

Satyam has also appointed the Boston Consulting Group as management advisors, which will see three senior representatives working with the new board to ‘spearhead the organization’s revival’. BCG will not be charging Satyam for its services.


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