L&T trebles Satyam stake to 12 per cent as iGATE shows interest

23 January 2009

Engineering and construction firm Larsen & Toubro Ltd has raised its stake in troubled software firm Satyam Computers to 12 per cent, from 4 per cent.
 
Y M Deosthalee chief financial officer, L&T said. that the company had not asked for a board seat and the fresh stake acquisition was aimed at protecting its interest in the Hyderabd IT firm.

Earlier this week, L&T chairman A M Naik met the company afgfairs minister Prem Chand Gupta and minister of state in the Prime Minister's Office Prithviraj Chauhan, Deosthalee had a meeting with LIC officials in Mumbai.

If L&T increases its stake to 15 per cent then it will have to make an open offer for an additional 20 per cent shares from the general public.

Meanwhile Phaneesh Murthy of iGATE Technologies said his company was open to buying Satyam.

In an interview with CNBC TV18 he said, "In spite of all of the problems of Satyam there are good assets in Satyam. They have good customers that they are working with. There are good employees who are working on many of these projects and many of these accounts. So those are the real tangible assets of Satyam. In addition to the fact that there is some land and so on, that's also a real tangible asset but the primary assets as an IT company that we look for are the accounts and the people who are working on this.

"So my argument is that Satyam might have two - three paths presumably available to it. One could be to split the company up, auction of certain accounts and raise enough capital to keep the company going because it is clear that raising capital right now with the unknown liabilities is quite difficult. So they might be forced to do this in the interim short-run to raise enough capital to keep the rest of the company going.