SATYAM STAKE SALE, The good news for the day was Satyam getting the green signal from SEBI for inducting a strategic partner through sale of 51% m via a global bidding process. Expression of Interest from qualified investors will be invited shortly.
A quick glance at the fine print of the guidelines
- Satyam will issue fresh equity of 31% to the investor. Remaining 20% would be made through an open offer at the same share price as the price paid by the investor for the subscription.
- Second preferential allotment allowed if bidder fails in first attempt to acquire 51% but this would not be thro’ an open offer. The investor would have a lock-in of 3 years from the date of the acquisition, though there is no restriction on subscription to additional equity shares.
- Qualified investors who bid should have total net assets in excess of US$150 million.
- SEBI has exempted Satyam from the normal rules.
- International bidding process to be followed.
- The process of selection of a strategic investor will be overseen by a retired judge of the Supreme Court or former Chief Justice of India.
Since the stake sale of Satyam is being made by preferential issue route, it may see a bidding of upto Rs.100 per share. A potential acquirer, may have to shell out another Rs.1,800 crore to make an open offer for 20% shares, being 18.20 crore of the expanded equity of 91 crore shares, at about Rs.100 per share. So a potential acquirer must have financial ability to contribute close to Rs.4,000 crore for acquiring an effective control of Satyam. thanks
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