Mahindra Satyam (the new brand identity given to the fraud-hit IT outsourcing company by its new owner), has allotted 19,86,58,498 shares to the Tech Mahindra-controlled subsidiary Venturbay Consultants Private Limited.
Venturbay now holds around 43 per cent of the outstanding share capital of Satyam, which post the allotment stands at 1,175,455,935 equity shares (including equity shares underlying ADSs), Mahindra Satyam said in a press release on Friday.
On July 8, 2009, the Company Law Board (CLB) has passed an order to allot 198,658,498 equity shares of Rs 2 each at a premium of Rs 56 each to Venturbay without shareholders’ approval. In addition, the order permitted the Satyam board to appoint a statutory auditor for the financial year 2009-10.
“The allotment of the additional shares was subject to Venturbay transferring the subscription amount aggregating Rs 1,152 crore from the public offer escrow account to Satyam’s account.
The company expects to use these funds for its general corporate purposes,” the release added.
Tech Mahindra’s tender offer – which had expired on July 1, 2009 – to acquire a further 20 per cent stake in Satyam received a tepid response. On July 6, Tech Mahindra said in a regulatory filing that “a total of 420,915 shares of Satyam common stock (including 268,656 shares underlying ADSs) were validly tendered and not withdrawn, representing less than 0.1 per cent of the outstanding shares of common stock.” The tender offer had expired on July 1, 2009.
Consequent to the lukewarm response to the tender offer and pursuant to the terms of the share subscription agreement on July 6, Venturbay gave notice to Satyam, exercising its option to subscribe to additional shares by way of a preferential allotment.
