Satyam board meets on takeover guides

A spokeswoman for Satyam said company would issue a statement after the board meeting.

Satyam Computer Services’ board began a meeting on Thursday that is expected to set pricing guidelines for a preferential share issue to a strategic investor in the outsourcer at the centre of India’s biggest corporate fraud.

Analysts say potential bidders for Satyam are attracted by its marquee clients,business model and a trained workforce,but putting a price for the company could be difficult in the absence of audited accounts and clarity about its liabilities.

“They could take a potential leap of faith here,” said Sachin Jain,Jefferies & Co’s equity research analyst. “Apart from their inability to do a due diligence regarding the financials,there are couple of other issues like lawsuits from investors.”

New York-listed Satyam has been struggling for survival since Jan. 7,when its founder and chairman Ramalinga Raju quit after disclosing profits had been overstated for years and assets falsified.

Chairman Kiran Karnik said on Tuesday that Satyam,which specialises in business software,hoped to invite expressions of interest from potential bidders by the end of the week.

A spokeswoman for Satyam said the company would issue a statement after the board meeting,which is likely to end in the afternoon.

Potential suitors for Satyam include India’s top engineering and construction firm Larsen & Toubro,Hinduja Group and Spice Group.

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The government-appointed board is being advised by Goldman Sachs and Indian investment bank Avendus Advisors in its search for a strategic investor.