The numbers show the interest Satyam had generated amongst prospective buyers. No fewer than 149 registered first. Out of these, ten submitted expression of interest. In the next lap, three were rejected and three didn’t show up. Cognizant exited the night before the bids were open. Finally, Tech Mahindra bid higher than Larsen & Toubro as well as WL Ross & Co. and bagged the troubled software company.
The question that is waiting to be asked is, why did so many people exit the race? The stock answer is the huge liabilities Satyam faces. There are the 13 class actions suits running in the US, Upaid wants to extract $1 billion on a forgery case, Rajus have laid claims to Rs 1,230 crore that the company owes them.
The first two can be settled out of court. The final damage could be a fraction of the original claim. The Central Bureau of Investigation has said that it found no trace of the money that the Rajus claim to have pumped into the company to plug the hole their misdemeanors had caused. So that too can be contested in a court of law. (Incidentally, companies controlled by the Rajus sent out letters to Satyam the day after Ramalinga Raju made his infamous confession on January 7 claiming the money back.)
One factor that seems to have been missed by commentators is real estate. In the weeks following Ramalinga Raju’s confession, there was widespread suspicion that he had taken money out of Satyam to buy properties for Maytas Properties, a closely-held company of the Rajus. The plan, it was said, was to sell these properties, book profits and quietly put the money back in Satyam. The Union Corporate Affairs Ministry’s plan to supersede the Maytas Infra and Maytas Properties boards just added to that belief.
At least one suitor even made a secret trip to Hyderabad to verify the facts. The import was simple: Anybody who got control of Satyam would also get Maytas Properties. Remember, the valuation of the company for its ill-fated acquisition by Satyam was well over Rs 6,000 crore. Though Ernst & Young, which was quoted as having done the valuation, said it wasn’t for an acquisition, most people felt it wasn’t too off the mark.
 But the cookie crumbled when the Corporate Affairs Ministry could bring no evidence of fund diversion before the Company Law Board. The Central Bureau of Investigation too in its charge sheet said there was no evidence to suggest siphoning out of money. That is when some of them could have lost interest.