Legal bindings: Satyam Mahindra on the way to remove one legal bottleneck
FRAUD-HIT Satyam has agreed to pay $70m (£43m) to British payment services firm Upaid, settling one of several lawsuits against the Indian outsourcing company.
The out-of-court settlement is far less than the more than one billion dollars Upaid was seeking in damages for alleged forgery, fraud and breach of contract.
The settlement, announced on Wednesday (December 9), ends uncertainty over one of the lawsuits filed against Satyam, which was shaken in January when company founder B Ramalinga Raju confessed to staging India’s biggest ever corporate fraud.
But the Hyderabad-based company still faces at least two class action shareholder suits launched in the US in connection with Raju’s fraud alleged by Indian police to total more than $3bn (£1.84bn).
Upaid had claimed Satyam gave it forged documents in a filing that eventually resulted in the British firm losing patents infringement cases.
“The agreement (with Upaid) provides for a first payment of $45m (£28m) within 10 business days and a second payment of $25m (£15.3m) within 12 months after the first payment is made,” Satyam said in a statement.
Under the settlement, which is subject to regulatory and other approvals, Upaid will drop all charges against Satyam.
Satyam said late last month it could not quantify its potential liability in the US lawsuits.
Satyam rebranded itself Mahindra Satyam after being taken over in April by midsized Indian computer outsourcer Tech Mahindra after Raju’s fraud came to light.
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