Mahindra Satyam's merger with Tech Mahindra next year

Syndicated from IANS | Published on Thu, Nov 10 2011 17:48 IST | 295 Views | Add comment
Hyderabad, Nov 10

Mahindra Satyam's merger with parent firm Tech Mahindra will take place next year, its chairman Vineet Nayyar said Thursday.

"It is a process. We are looking at it when to commence it and we are hoping that by the next year, some time in later half of the year, this amalgamation will in fact take place," he told reporters while declaring Q2 results of Mahindra Satyam.

Nayyar recalled that after winning the bid for the company in April 2009, Tech Mahindra had indicated its intention to merge. "That intention remains," he said.

In May this year, he hinted that the merger may be delayed as it is a legal process which has to go to two high courts.

Tech Mahindra had acquired Satyam Computer Services Limited in April 2009, a few months after Satyam was rattled by India's biggest corporate fraud. Satyam was subsequently re-named Mahindra Satyam.

To another query, Nayyar said the firm had resolved almost all cases in the US, which arose because of the fraud committed by the earlier management.

The company has already paid $10 million to settle the US Securities and Exchange Commission's suit over the fraud. It paid $125 million to settle class action suits and another $70 million to settle the Upaid case.

On the Income Tax department's notice to pay Rs.616 crore tax, Mahindra Satyam CEO C.P. Gurnani said the demand on fictitious income was unreasonable. "That is the reason we have choosen to go to court and are seeking justice," he said.

The Mahindra Group company had earlier said that on the one hand, the government agencies were prosecuting former Satyam chief B. Ramalinga Raju for showing fictitious income, but on the other, making the same fictitious income a basis for demanding taxes.

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