The bidding process for the beleaguered software firm Satyam ended on Monday with Tech Mahindra emerging as the highest bidder with an offer price of Rs 58 per share. Tech Mahindra’s price outbid other suitors—engineering giant Larsen & Toubro and private equity player Wilbur Ross—by a wide margin. L&T’s bid of Rs 45.90 per share and Wilbur Ross’ Rs 20, were not even within striking distance of Tech Mahindra’s deal-winning bid. At Rs 58 per share,Tech Mahindra will acquire a controlling stake of 51% in Satyam for Rs 2,889 crore, pegging the total value of the company at Rs 5,665 crore. In the first stage, Satyam will issue 30.27 crore shares to Tech Mahindra, representing 31% of the company’s share capital, which will infuse Rs 1,756 crore. In the second stage, Tech Mahindra will have mandatorily to make an open offer to Satyam’s existing shareholders for another 20%. However, L&T, which holds a 12% stake in Satyam, will not participate in the open offer for shareholders as it has a lockin period of six months. Predictably, both the Tech Mahindra and Satyam stocks were caught in a volatile vortex. Early in the day, the Tech Mahindra scrip on the BSE gained 25% to Rs 400. However, late profit-taking forced it to close at Rs 349, up 12.3%.
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