The London Financial Times is reporting that the government of India has put 51% of the shares in Satyam up for sale but there's a catch:
Bidders for India's fourth- largest computer group are being warned that there are no reliable financial accounts available for the company and that they must come up with their own assessment of the potential liability from shareholder suits.
"We have been telling people there's going to be nothing available on that front," said one person familiar with the transaction, referring to the financials.
I'd be amazed if there was anything other than a substantial discount on the current $500 million market cap. Surprisingly, eight bidders are said to have come forward in what is a very hasty disposal timetable. It seems the current Indian government is anxious to get rid of the Satyam problem before the country goes to the polls for a month long general election. The closing bid date is April 15th with an expectation the deal will be done almost immediately. Polls open April 16th.
According to the FT, bidders have been undertaking due diligence since last week but even so, barely three weeks of reviewing a company that's as toxic as Satyam? Especially when the audit teams that have been in since mid-January don't expect to get done with their work for at least another six months?
None of the big outsourcing players like IBM, HP/EDS or Accenture are thought to be on the list of bidders. I'm not surprised. I can't imagine anyone other than a speculator being prepared to put a price on Satyam.