With the government now taking over things it will be reassuring for Satyam customers, employees and stakeholders. These is assurance now of business continuity and this could eventually help the beleaguered company find a buyer. In fact, things look bright for a government assisted transaction like a Bear Stearns type of rescue where JP Morgan bought (assisted by the US government) the beleaguered investment bank for as low as $10 a share.
Alternately, post a thorough due diligence by government and auditors, Satyam could be broken up into pieces (BPO business, verticals, service lines et al) and sold to several buyers, like energy giant Enron was. "With the government taking over the board, we are advising our clients to stay put as the cost and time of transition is very large at the moment," says Avinash Vasishtha, CEO of Tholons.
There are three options before the government. According to Tholons, the best option is to stabilise Satyam and merge it with an indemnity against any financial liability with a bigger IT company.
However, even as the government would prefer a quick end to the current turmoil, there could be delays due to the sheer magnitude of the mess. Whichever way things go, experts agree that Satyam may not exist as a standalone entity for very long. With government support it will be easier, to begin with get cash to manage the operations of the cash starved company, reassure global clients and stakeholders and eventually find a buyer.
Courtesy -the Economic Times
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