HYDERABAD: The rumour about IBM taking over Satyam is refusing to die down. But reiterating its earlier stance, the Raju family, promoters of Satyam, has once again flatly denied any possibility of the founders selling out.
“There is no basis for this talk,” said Satyam managing director Rama Raju talking to DNA Money.
“One could have imagined speculation if there had been at least a customery visit by IBM or any other perceived suitor. But neither have there been such visits nor has the thought ever occurred to us. We suspect that every time someone wants to make money on the scrip, the rumour is floated,” he said.
Talk on the street is an internal IBM M&A team has been doing due diligence of Satyam books. This could not be separately confirmed.
In fact, in September last year the Raju family locked in its entire 8.54% stake in a holding company called SRSR Holding, that will give them better control over the core equity.
While better long-term tax planning is the ostensible reason for the corporatisation of the family’s equity, according to some in the know, the move also precludes any unilateral exit from the holding by any member of the family.
While Satyam chairman Ramalinga Raju held 2.83% equity (9.225 million shares) in the company as of June 30, 2006 younger brother and managing director Rama Raju held 3.28% equity (10.72 million shares). Nandini Raju held 1.24%, while B Radha Raju held 1.19% equity in the company.
According to one analyst, while the lock-in would definitely help them in tax planning, it will also enable the family to avoid any unpleasant situations seen in the recent past in Indian family run businesses leading to split up in ownership.
Explaining the spurt in the Satyam scrip one analyst felt the primary reason could be the valuation gap between the stock and the peers in the industry.
Though the takeover rumour has been there for sometime, the scrip is attractive considering it is still undervalued, he added.
Source : DNA
“There is no basis for this talk,” said Satyam managing director Rama Raju talking to DNA Money.
“One could have imagined speculation if there had been at least a customery visit by IBM or any other perceived suitor. But neither have there been such visits nor has the thought ever occurred to us. We suspect that every time someone wants to make money on the scrip, the rumour is floated,” he said.
Talk on the street is an internal IBM M&A team has been doing due diligence of Satyam books. This could not be separately confirmed.
In fact, in September last year the Raju family locked in its entire 8.54% stake in a holding company called SRSR Holding, that will give them better control over the core equity.
While better long-term tax planning is the ostensible reason for the corporatisation of the family’s equity, according to some in the know, the move also precludes any unilateral exit from the holding by any member of the family.
While Satyam chairman Ramalinga Raju held 2.83% equity (9.225 million shares) in the company as of June 30, 2006 younger brother and managing director Rama Raju held 3.28% equity (10.72 million shares). Nandini Raju held 1.24%, while B Radha Raju held 1.19% equity in the company.
According to one analyst, while the lock-in would definitely help them in tax planning, it will also enable the family to avoid any unpleasant situations seen in the recent past in Indian family run businesses leading to split up in ownership.
Explaining the spurt in the Satyam scrip one analyst felt the primary reason could be the valuation gap between the stock and the peers in the industry.
Though the takeover rumour has been there for sometime, the scrip is attractive considering it is still undervalued, he added.
Source : DNA