Tech Mahindra’s open offer for a 20 per cent stake in Satyam Computer Services will commence on June 12 and close on July 1. The offer follows the acquisition of a 31 per cent stake in the company last week.
Tech Mahindra proposes to acquire 19.9 crore shares of the target company (Satyam) representing 20 per cent of the fully diluted share capital at a price of Rs 58 a share, the company’s public announcement for the offer said.
The open offer for Satyam does not contain key financial details of Satyam as SEBI has granted certain relaxations/ exemptions/permissions from strict compliance in connection with the process to be followed by the company pursuant to Regulation 29A of the SEBI takeover regulations.
The details of the relaxation are not spelt out in the public announcement and it is presumed that the relaxations are related to the offer price in terms of the Regulation 20 and also to certain other disclosures required to be made under regulations 16 of the SAST regulations (which detail contents of the public announcement of offer).
Tech Mahindra, which has been privy to Satyam-specific financial information, has not disclosed ‘select financial data’ related to the target company. This too could be in line with the relaxations provided by Regulation 29A, say analysts.
By virtue of the amendment to SEBI’s regulation 25 (2B) in February, no competitive bid shall be made once an acquirer has made a public announcement for an open offer after having obtained relaxation in the takeover regulations.
Tech Mahindra’s holding in Satyam would go up to 51 per cent eventually, even if the open offer is not fully subscribed. Satyam will make a fresh issue to equity shares to Tech Mahindra to raise its holding to 51 per cent.
Kotak Mahindra Capital made the open offer announcement on behalf of Venturbay Consultants, a unit of Tech Mahindra.
Source: The Hindu Businessline