New Delhi, July 02: Tech Mahindra on Thursday said it will
request the Satyam Board to allot shares on a preferential
basis to raise its stake in the Hyderabad-based firm to 42.7
per cent as the company's open offer received a tepid
response.
"Due to the weak response of the open offer we will
request the Mahindra Satyam Board for the preferential
allotment as laid down in the bidding document. Post the
preferential allotment, the stake of Tech Mahindra in Mahindra
Satyam will be 42.7 per cent," a company spokesperson said.
The preferential allotment would be made at the open offer
price of Rs 58 a share.
The offer, which opened on June 12, closed yesterday.
"The final number of shares tendered and accepted (including
shares underlying American Depository Shares) will be
announced on July 8, 2009," Tech Mahindra had said yesterday.
However, the company has not decided on the future course
of action post the preferential allotment, he added.
The open offer price of Rs 58 a share was much less than
the prevailing market price of Satyam, which is hovering
around Rs 70-80 level.
The scrip has gained significantly since the time Tech
Mahindra acquired a stake in Satyam in April. The scrip has
surged over 58 per cent since April 22.
The IT firm, which has earlier picked 31 per cent stake
in Satyam for Rs 1,756 crore in April, has the option of
subscribing to new shares of Satyam.
Mahindra Satyam to meet on July 10
The board of Mahindra Satyam will
meet on July 10 to discuss the second round of preferential
share allotment to raise Tech Mahindra's stake in the firm to
about 42.7 per cent.
"The board will meet on July 10. Tech Mahindra is
expected to exercise its option to take its stake forward
through a second preferential route ... they may also decide
to stay at their existing level of 31 per cent, it is their
call," Kiran Karnik, chairman of the board of Mahindra Satyam,
said.
In April Tech Mahindra acquired 31 per cent in Satyam for
Rs 1,756 crore.
Asked about the lack of response from the shareholders to
the open offer, he said "it is a sign of strength of the
company that the share price has moved from Rs 40-45 to Rs 73
since the first preferential option was exercised".
Tech Mahindra's open offer price was Rs 58 a share and
analysts said the lower open offer price was (compared to the
current price) the reason for the lack of response.
The Satyam stock touched its upper limit of 5 per cent to
close at Rs 77.20 on the Bombay Stock Exchange today.
Bureau Report
First Published: Thursday, July 02, 2009, 21:16