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Spice Group to scout for other buys

The BK Modi-promoted Spice Group may scout for other companies if it backs out from the race to acquire Satyam Computer Services, a senior executive has said.

business Updated: Mar 29, 2009 20:37 IST
Mahua Venkatesh

The BK Modi-promoted Spice Group may scout for other companies if it backs out from the race to acquire Satyam Computer Services, a senior executive has said.

“We want to expand and we would be forced to look for other companies,” the executive, who did not wish to be named, said. Spice has said it could withdraw from the race to acquire Satyam as it felt the entire process is not transparent, nor as per Company Law Board rules.

The company has raised the issue with Justice SP Bharucha, former Chief Justice of the Supreme Court, who has been appointed to oversee the entire bidding process. “Only if we get a positive response on the issue and if the process is an open auction one, we would be happy to continue with the bidding process,” the executive said, adding that there should be clarity on the other bidders as well.

The Hinduja Group and iGate have already backed out from the Satyam race. Heavy engineering major Larsen and Toubro, and Mahindra and Mahindra are still in contention, and are likely to place their financial bids by April 9.

Putting a value to Satyam is unlikely to be easy, as there are no authentic financial and legal records. A source who did not wish to be quoted said that the valuation may drop even further as the government has remained silent on providing a protection scheme to the prospective bidders against inherited debt.

A delay in the bidding process would also impact the valuation. This would also dissuade customers and bankers, who are keeping a close watch on the developments.