Satyam shareholders rebuff Tech Mahindra's open offer

Shareholders of Satyam have rebuffed the open offer made by IT firm Tech Mahindra as only 4,20,915 shares, or 0.1 per cent stake, in the company were tendered in the offer.     

IT firm Tech Mahindra had proposed to acquire 198,658,498 shares representing 20 per cent stake in the company through the open offer.     

In a regulatory filing Tech Mahindra said, "A total of 420,915 shares of Satyam common stock (including 268,656 shares underlying ADSs) were validly tendered and not withdrawn, representing less than 0.1 per cent of the outstanding shares of common stock."     

While the open offer for acquiring up to a 20 per cent stake was made at a price of Rs 58 per share, the share for Satyam Computer is at present hovering around Rs 75, over 29 per cent higher than open offer price.     

Earlier, Tech Mahindra's chief financial officer Sonjoy Anand had said: "Tech Mahindra has not received a significant response to its tender offer to purchase 20 per cent of Satyam Computer Services from the shareholders."     

At present, the open offer shares together with the shares beneficially owned by Tech Mahindra and its wholly-owned subsidiary represent approximately 31.04 per cent of Satyam's outstanding shares of common stock. 

Today's filing further added, "Tech Mahindra intends to subscribe 198,658,498 additional shares at Rs 58 per share in subsequent allotment in accordance with the share subscription agreement entered into among Satyam, Tech Mahindra and Venturbay."     

Board of Mahindra Satyam, (previously Satyam Computer Services) is scheduled to meet on July 10 to discuss the second round of preferential share allotment to raise Tech Mahindra's stake in the firm to up to 42.7 per cent.     

According to Kiran Karnik, Chairman of the board of Mahindra Satyam the board decides to go ahead with the offer, the second preferential issue should happen in the next 15 days and both the Company Law Board and Sebi's approval are needed for this.