Saturday March 28, 2009

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By Sam Devraj  ( Assistant Editor )

Satyam sale: Bidding process evokes criticism

INDIA’S Spice Group announced on Friday (March 27) it was temporarily withdrawing from the race for scandal-tainted Satyam Computer Services, complaining the bidding process was not transparent, a report said.

Satyam’s government-appointed board is looking for a buyer for Satyam to infuse funds into the company and ensure its survival after its finances were left in a shambles by the country’s biggest accounting fraud.

“The withdrawal is for the moment,” a senior company official said.

The company, once India’s fourth-biggest software services exporter by sales, said it had written a letter to Justice S P Bharucha, who is overseeing the bidding process, asking for more transparency in the sale.

Tycoon B K Modi, who owns Spice Group, has been pushing to know the names of other shortlisted bidders for Satyam and more details about the company’s financial state among other requests.

Spice is also calling for an e-auction where the bidding takes place via the Internet and bidders can see each other’s bids. However, Satyam’s board is asking for sealed bids.

Once the company receives a response to its letter, “we will decide accordingly whether to remain in the race,” the unnamed company official was quoted as saying.

Indian engineering giant Larsen & Toubro and telecom software firm Tech Mahindra Ltd are two confirmed bidders in the race for Satyam. But media reports have said there are up to eight.

Larsen & Toubro has already built up a 12 percent stake in Satyam and is seen as a frontrunner for a 51 per cent stake in the company.

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