Scenario -1b: Satyam gets Acquired :
Scenario -1b: Satyam gets Acquired Satyam is split into multiple entities and acquired by more
than one organizaton
Risks to Buyer
Service delivery and quality will be impacted due to presence of multiple entities
Potential increase in cost of services for additional scope of work
Increased challenges related to program management and governance
Scenario- 3: Satyam Continues to Exist as an Entity :
Scenario- 3: Satyam Continues to Exist as an Entity Risks to Buyer
Management changes at Satyam may be disruptive resulting in exodus of employees, key personnel and senior management
Loss of goodwill with stakeholders (employees, investors and clients)
will significantly impact Satyam’s ability to gain business in future
Ability to scale-up, retain & attract talent will be limited
Scenario-4-Organizational Reconstruction :
Scenario-4-Organizational Reconstruction The existing entity will cease to exist and a new entity will be formed with new ownership
The new ownership may include
Private ownership – 70% to 75%
Government ownership – 25% to 30%
It will be easy for new entity with new balance sheet to raise the funds
Acquisition by L&T :
Acquisition by L&T L&T has increased its stake from 4% to 12%
L&T can increase the stake maximum up to 15%
Beyond 15% L&T will have to make an open offering to buy out additional 20% of the stockholdings
As per SEBI takeover code the price for such offer would be average of high and low of satyam shares during last 26 months
As per the above formula L&T will have to make an offer minimum for Rs. 270 per share which is quite higher than current market price of Satyam.
L&T has approached SEBI for some relaxation in pricing norms
From view point of Satyam