Satyam to go for open auction if bids fall with in 90 per cent of top bid

Satyam Computer Services Ltd has submitted a letter to the Securities and Exchange Board of India (SEBI) relating to a slight modification in the bidding process to be followed by the company to select an investor.

In its letter to SEBI, the fraud-hit IT service company said in order to realise higher value, it would conduct an open auction in case there are one or more bidders within 90 per cent of the top financial bid.

Satyam had on Thursday filed the SEBI letter along with a press release with the Bombay Stock Exchange and the National Stock Exchange. It also furnished the SEBI letter and the press release to the US Securities and Exchange Commission (SEC), according to a Satyam website release.

If one or more financial bids are at least 90 per cent of the highest bid, the top bidder as also those within 90 per cent would be asked to participate in the open auction and raise their bids, the company said.

The highest bid will then be the floor price and the sale will then be through open auction, the company said in its note to SEBI. The mechanism for the open auction would be notified to the bidders separately, it said.

In case the bidders stick to their earlier positions even after the open auction, then the highest sealed bid shall be declared as the successful bid, the company added.

While engineering and construction giant Larsen & Toubro and technology firm Tech Mahindra are among those in the race to acquire Satyam, the Spice Group had withdrawn from the race alleging lack of transparency in the bidding process.

It is also not clear who are all still in the race for the Satyam stake.