Satyam Computer Services today modified the bidding process to ensure that if no bid comes within at least 90 per cent of the highest bid, the highest bidder would be declared the final buyer.
Accordingly, the government-appointed board and Justice S P Bharucha, the former Chief Justice who will oversee the bidding, will open the sealed financial bids submitted by the shortlisted qualified bidders whose technical bids have been found satisfactory, and rank them based on price only. Earlier, there was no ranking of the bids.
Satyam has submitted a letter to the Securities and Exchange Board of India (Sebi) on this modification in the bidding process.
Incidentally, the B K Modi-owned Spice Group had demanded, among other things, an 'open auction' process for Satyam. When pulling out of the race, it had said that it would reconsider its decision only if the Satyam board reconsiders its decision. When contacted in this regard, Preeti Malhotra, executive director, Spice Innovative Technologies, said: "We will take a formal decision in this regard only at our board meeting, which will be held on Saturday."
If one or more financial bids are at least 90 per cent of the highest bid, the board will treat the highest bid as the floor price and conduct an open auction, by asking the highest bidder and those bidders whose bids are at least 90 per cent of the highest bid to raise their bids.
If none of the bidders raise their financial bids after the open auction, then the highest sealed bid received will be declared the successful bid.
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If the bidders at the open auction raise the bid value, then the highest bidder in the open auction will be declared the successful bidder.
The mechanism for the conduct of the open auction will be notified to bidders separately.
Earlier, the board was to call an additional round of sealed financial bids on the same day from the highest bidder and from those whose bids were at least 90 per cent of the highest bid.
If the second round was tied, the board proposed to call for subsequent rounds of bids amongst the tied qualified bidders until the tie was broken.