The winning bid for a majority stake in Patni Computer was likely to be under 550 rupees a share, a person with direct knowledge of the matter said, which is 12.5% above its Friday closing price.
Shares in Patni rose as much as 3.2% on Friday after media reports that leading bids for a majority stake in the firm ranged from 530 rupees a share to 600 rupees a share.
The Economic Times said on Friday that private-equity firms Carlyle, Advent International and Akansa Capital had partnered to bid 600 rupees a share, while the Business Standard said a consortium of Apax Partners and iGate was the lead bidder at 525 to 530 rupees a share.
Sources told Reuters that both groups had made bids, and one of the sources said a decision was expected in the next week.
Patni, which has a market value of about $1.4 billion, declined comment. Carlyle and Apax were not immediately available for comment.
Shares in Patni ended 1.74% higher at 488.85 rupees, outperforming the main index, which ended 0.45% higher.
Talks to sell a stake in the software services exporter have been going on for about two years, but Patni has failed to seal a deal due to valuation gaps with potential buyers, sources previously told Reuters.
The founding Patni brothers are looking to sell their 46% stake, while private equity firm General Atlantic plans to sell its roughly 17% holding, the sources have said.
Two sources with direct knowledge of the matter said on Friday that a deal hinges on whether all three founding brothers agree to terms of a deal to sell their stakes.
"If even one of them finds any issue with the deal the entire process would fall apart. The only difference this time is that competitive financial bids have been placed," one of the sources told Reuters.
Patni, a mid-sized Indian IT services firm also listed in New York, provides technology outsourcing services to industries such as insurance, telecom, utilities and retail.
Small and mid-cap Indian IT companies have been grappling with tepid demand, high attrition rates and a rise in expenses, resulting in reduced profitability for some.