Shareholders of Mahindra Satyam have opposed the management's proposal to merge the company with Tech Mahindra. Some wanted the company not to rush the merger deal. They are worried that any merger now would give them a raw deal, keeping in view the scope for a very low valuation for the company than it really deserves.
At the annual general meeting (AGM) held here on Wednesday, they felt that the financial mess the company had faced and negative sentiments could result in a swap ratio that would go against their interests.
Terming disheartening and disappointing company's plan to shelve plan to relist on New York Stock Exchange (NYSE), Mr Ravi, an investor, said relisting would have helped in reviving fortunes of the company. He wondered whether shelving the plan would impact company's business prospects as some customers and investors might insist on NYSE listing for letting it to bid for projects.
He asked the company not to rush with the merger plan, while joint go-to-market strategy with Tech Mahindra was welcome.
Mr Vineet Nayyar, Chairman of Mahindra Satyam, assured the agitated shareholders that they would get a fair and equitable deal when merger took happened. On the relisting, he said the company too was equally disappointed (for having to shelve the plan) but it could not help but to wind up ADS plan following inability to meet stringent SEC (Securities and Exchange Commission, US) requirements to explain entries during the questionable period of the fraud.
“We would consider NYSE listing after the merger. We do not any vested interest (in merging with Tech Mahindra). Rules and regulations are well in place to ensure a fair deal. Valuations for two companies and swap ratio will be decided by valuators and bankers. We will come to you for your approval with the proposals,” he said.
The company intended to start the merger process in 2011-12 by kicking off valuations and approaching respective AGMs for their nod and, then, High Courts.
Winding up of ADS programme would clear the air for the company o go ahead with the merger. The company expected to complete the ADS delisting in the next seven months.
Raju's assets
Stating that most of the company stayed clear of most legal issues, he said the company would like to pursue legal options to claim part of the assets of Mr B Ramalinga Raju, the former Chairman, as damages.