Mumbai, Oct. 4: Satyam Computer Services Ltd has finally found a strategic buyer for its ISP venture—Satyam Infoway Ltd.
Satyam Computer, in a late evening communiqué to the Bombay Stock Exchange, said it was entering into separate definitive agreements with the Softbank Asia Infrastructure Fund (SAIF), through a company controlled by it and VentureTech Solutions Pvt Ltd (VentureTech), which will invest a total of $ 20 million in new shares of Sify.
The separate investments by the SAIF Investor and VentureTech (including the subsequent VentureTech subscription) will change the shareholding pattern of Sify. The new arrangement will see SAIF Investor holding 21.70 per cent, VentureTech 11.70 per cent, South Asia Regional Fund 10.30 per cent, Satyam Computer 35 per cent, ADRs accounting for 17 per cent. About 4.30 per cent in the company will be held by other shareholders.
Today’s development will help Satyam Computer pare its exposure in Sify, whose huge losses had cast a shadow on the future of the parent itself. The announcement also effectively puts an end to market rumours that Reliance Industries was eyeing the ISP company, which is listed on the US bourses.
Satyam said it proposes to allow the SAIF-controlled company, SAIF Investor, to invest $ 13 million for approximately 7.56 million newly issued ADRs (one ADR is equal to one equity share) at a price of $ 1.72 per ADR. VentureTech will enter into a separate agreement to invest $ 3.5 million for approximately 2.03 million equity shares at the same price. It will subscribe to an additional $ 3.5 million equity shares on or before April 30 2003, at the same price.
Following the transaction, B. Ramalinga Raju will step down as Sify chairman. A new shareholders’ agreement and related provisions will provide for nine directors on the Sify board, which includes an independent director, and two nominees each from SAIF Investor, Venture Tech and Satyam Computer.