A Capgemini spokeswoman saidthe company would not comment on the talk, while a spokeswoman for IBM in India said it did not comment on rumours or market speculation.

Jefferies & Co equity research analyst Sachin Jain said technology firms with little or no direct presence in India would be the front-runners to pick up a stake in Satyam to boost their ability to deliver projects from cheaper locations.

"Clearly, in a slowing economy clients would be looking for more cost effective solutions. So for that reason, they would be interested," he said.

FINANCIAL BUYER

Investment banking sources saidfirms like Carlyle and Kohlberg Kravis Roberts & Co could be willing buyers in Satyam, but there was no confirmation of any talks.

"This is a great PE story," said the head of a private equity firm, who declined to be named. "It is among the top IT companies in India, great strengths, a strong workforce and a presence across all verticals and great bunch of clients."

However, analysts say the main stumbling point in a Satyam deal could be the price at which the promoters or institutional investors would be willing to sell and a potential acquirer would be willing to pay in a tough global credit environment.

"The issue is that even the big stakeholders won't be willing to sell their stake at a marginal premium right now and if they are expecting a substantial premium then who are the buyers right now?," said Jefferies' analyst Jain.