Satyam Announces Commencement of Process to Select an Investor
March 09 2009 - 8:08AM
PR Newswire (US)
HYDERABAD, India, March 9 /PRNewswire-FirstCall/ -- Satyam Computer
Services Ltd. (NYSE:SAY)(BSE:SATYAM)(NSE:SATYAMCOMP) (the
"Company") announced today that it is commencing a competitive
bidding process which, subject to receipt of all approvals,
contemplates the selection of an investor to acquire a 51 percent
equity interest in the Company. Based on the Securities and
Exchange Board of India's ("SEBI") response to the Company's
application seeking relaxations from certain requirements under
Indian law, the Board proposes to follow the bidding process
outlined below. Transaction Structure: The acquisition is expected
to occur in the following related steps: -- An initial subscription
by the selected investor of newly issued equity shares representing
31 percent of the Company's share capital after giving effect to
the share issuance ("enhanced share capital"); 1 Upon deposit of
the entire subscription amount by the selected investor with the
Company and requisite funds for the public offer in the escrow
account as required under the SEBI Takeover Regulations, the
investor will be required to make a mandatory public offer to
purchase a minimum of 20 percent of the Company's enhanced share
capital. The public offer will be made at the same share price as
the price paid by the investor for the initial subscription; and 2
If upon the closing of the public offer, the investor would have
acquired less than 51 percent of the enhanced share capital of the
Company through the initial subscription and the public offer, the
investor would have the option to subscribe to additional newly
issued equity shares, such that the shares acquired by the investor
through the three related steps, the initial subscription, public
offer and the subsequent subscription (if any) will result in the
investor acquiring not more than 51 percent of the enhanced share
capital of the Company. Ability to subscribe to additional equity
shares in the third related step would be subject to the terms and
conditions specified in the request-for-proposal ("RFP"). The
subsequent subscription, if any, will be required to be completed
within 15 days of the closing of the public offer and will not
result in requiring a further public offer. Process for
Registration of Interest: -- Commencing today, all interested
bidders should register their interest in participating in the
bidding process by accessing
http://www.satyam.com/bidprocess/march09/index.asp and registering
their interest by 5:00 p.m. Indian Standard Time on Thursday, March
12, 2009, subject to their meeting the registration requirements
set forth on such website. Interested bidders may see
http://www.satyam.com/bidprocess/march09/index.asp for more
details. -- The process for selecting a bidder shall be overseen by
a former Chief Justice of India or a former Supreme Court judge
appointed by the Company. Bid Process: -- Each interested bidder
that has validly registered its interest in participating in the
bid process by 5:00 p.m. Indian Standard Time on Thursday, March
12, 2009, will be sent an RFP shortly thereafter, and asked to
submit a detailed Expression of Interest ("EOI") together with the
proof of availability of funds in the amount of at least Rs. 1,500
crores (US$290 million based on exchange rate of Rs. 51.635 to
US$1) by 5:00 p.m. Indian Standard Time on Friday, March 20, 2009.
-- Based on submitted EOIs, eligible bidders will be short-listed
and given access to certain business, financial and legal diligence
materials relating to the Company provided they have executed a
non-disclosure and non-solicitation agreement, a stand-still
agreement and a "no-claims" undertaking. After completion of the
due diligence process and execution of the pre-financial bid
documents, all short-listed bidders will be asked to submit their
financial bids and an executed copy of the share subscription
agreement. -- Based on an evaluation of the bids, the Company will
select the successful bidder, after which the successful bidder
will have four days to deposit with the Company the entire
subscription amount, and the requisite funds for the public offer
in an escrow account. -- As a result of a relaxation from SEBI,
there is no requirement to have a minimum floor price that is
otherwise required under Indian law in connection with the initial
subscription. -- Upon selection of the successful bidder, the
Company will be required to approach the Company Law Board and SEBI
for approval and, upon receipt thereof, the successful bidder would
be allowed to consummate the subscription. Further details of the
bidding process and other terms and conditions would be set forth
in the RFP. This press release is not an offer of securities for
sale in the United States. Securities may not be offered or sold in
the United States absent registration or an exemption from
registration under the U.S. Securities Act of 1933, as amended. Any
public offering of securities to be made in the United States will
be made by means of a prospectus that may be obtained from the
Company and that will contain detailed information about the
Company and its management, as well as financial statements. The
Company does not intend to register any securities in the United
States or to conduct a public offering of securities in the United
States. As previously disclosed, the Company Law Board Principal
Bench New Delhi authorized the Company's Board of Directors to
select an investor, subject to certain conditions. The commencement
of the bidding process by the Company is not an assurance that any
qualified investor will bid to acquire any interest in the Company
at an appropriate price or at all. This press release contains
forward-looking statements within the meaning of section 27A of
Securities Act of 1933, as amended, and section 21E of the
Securities Exchange Act of 1934, as amended. The forward-looking
statements contained herein, including statements regarding the
global competitive bidding process, are subject to various risks
and uncertainties and there can be no assurance that the Company
will be able to find a qualified investor. About Satyam Satyam
(NYSE:SAY), a leading global business and information technology
services company, delivers consulting, systems integration, and
outsourcing solutions to clients in numerous industries across the
globe. Satyam leverages deep industry and functional expertise,
leading technology practices, and an advanced, global delivery
model to help clients transform their highest-value business
processes and improve their business performance. The company's
professionals excel in engineering and product development, supply
chain management, client relationship management, business process
quality, business intelligence, enterprise integration, and
infrastructure management, among other key capabilities. Satyam
development and delivery centers in the US, Canada, Brazil, the UK,
Hungary, Egypt, UAE, India, China, Malaysia, Singapore, and
Australia serve numerous clients, including many Fortune 500
organizations. For more information, visit: http://www.satyam.com/.
Satyam Contacts: For clarifications, write to us at Or contact our
global Satyam PR representatives at: US Jim Swords +1-703-877-2225
Europe Sandeep Thawani +44-783-010-3838 Asia-Pacific Dan Bleakman
+61-439-408-484 Reshma Wad Jan +65-98-140-507 DATASOURCE: Satyam
Computer Services Ltd. CONTACT: US: Jim Swords, +1-703-877-2225, ;
or Europe: Sandeep Thawani, +44-783-010-3838, ; or Asia-Pacific:
Dan Bleakman, +61-439-408-484, , or Reshma Wad Jan, +65-98-140-507,
, all of Satyam Computer Services Ltd. Web Site:
http://www.satyam.com/
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