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| Satyam's outgo on legal spats may not exceed $125 mn |
| Press Trust of India / New Delhi Jun 14, 2009, 16:30 IST |
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In what could be good news for the shareholders of IT firm Satyam Computer, the outgo on legal disputes may not exceed Rs 580 crore against the reported Rs 10,000 crore and perhaps this is the reason the new owner Tech Mahindra is not unduly perturbed about this.
Tech Mahindra is also hoping to settle some of disputes within six months while a few may take another couple of years, highly placed sources said.
"We don't expect the expenses related to the legal disputes to run as high as reported in certain sections in the media. We expect some of the cases such as the Upaid case to get over by November this year. The US class action suits will get over in another two years," a senior official said on conditions of anonymity.
After the admission of a massive financial fraud by Satyam's disgraced founder B Ramalinga Raju in January this year, the government superseded the company's board, which later decided to sell Satyam Computer to Tech Mahindra.
By that time, about 12 lawsuits had been filed against the IT firm in various US courts, with many charging the company with duping thousands of investors of billions of dollars. There were reports that Satyam could face legal and other claims that could put a burden of up to Rs 10,000 crore on it.
These include claims worth about Rs 400 crore related to four overseas acquisitions made under the leadership of Raju and a demand of about Rs 1,230 crore from as many as 37 unacknowledged creditors.
Besides, there is a $1-billion (about Rs 4,800 crore) long-running fraud litigation with British firm Upaid and the class action lawsuits filed by its US shareholders over the multi-crore financial scam at the company, with an estimated demand of another $1 billion.
However, according to sources privy to the situation, the company does not expect the related legal cases to run into over $100-125 million.
Satyam is trying to settle amicably some of these claims, while it intends to vigorously defend the class action law suits filed against the IT firm in the US and also the case filed by British mobile service firm Upaid in a Texas court.
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