Distressed investment firm WL Ross is the only private equity firm still bidding for a majority stake in India's Satyam Computer Services, according to a report in India’s Economic Times.
Other prospective buyers include Larsen & Tourbo, an Indian engineering conglomerate; Tech Mahindra, an IT services firm; and US-based Cognizant Technology Solutions, an IT, consulting and business process outsourcing company, the paper added.
WL Ross and Larsen & Tourbo may now bid jointly for a controlling stake in the IT company, an unnamed source told Daily News & Analysis, another Indian newspaper. WL Ross and Larsen & Tourbo signed an agreement last week and may offer INR20 billion ($400 million) for a stake of at least 51 percent, according to the paper. It added that the two firms plan to invest another INR20 billion to revive Satyam if their joint bid is successful. Larsen & Tourbo already owns a 12 percent stake in Satyam. It acquired a 4 percent stake in December 2008, followed by an 8 percent stake in January 2009.
WL Ross could not be reached for comment.
The Blackstone Group, The Carlyle Group, Kohlberg Kravis Roberts and Apax Partners were also eported to be vying for Satyam, although a source close to the matter told PEO that KKR had never been interested in the company. Carlyle did not respond to a request for comment by press time. Apax, KKR and Blackstone declined to comment.
In August 2008, WL Ross led a transaction also involving Dubai government-backed Istithmar and Goldman Sachs to invest $100 million in SpiceJet, an Indian budget airline listed on the Bombay Stock Exchange. In 2006, the firm acquired OCM India, a worsted textile manufacturer, for about $37 million.
In January, Ramalinga Raju, founder and chairman of Satyam, disclosed that he falsified the company’s accounts and overstated cash and bank balances by approximately $1.4 billion. After Raju’s resignation in the same month, the Indian government nominated a board of directors and Satyam is presently a government-administered company.