Is Tech Mahindra overpaying?
The company doesn’t think so. In the worst-case scenario, it does not expect Satyam’s annual revenues to drop below $1.3 billion. The figure is arrived at after assuming 15 per cent of the revenues were overstated and factoring in client attrition, which would shrink the figure from $2.2 billion to $1.5 billion. If private equity investors step in later, it would indicate how much financial investors are willing to fork out for the stock. An outsourcing expert with a consultancy firm said, “Going by what Tech Mahindra has valued Satyam, I would say it is more of an entrepreneurial decision. They have been more aggressive. L&T on the other hand has been cautious.” Will there be layoffs? While most of the employees evoked a sense of relief after the winner was announced, many remained concerned about tough days ahead. This was true especially for those who are currently not part of any active customer project. Satyam professionals working in subsidiaries such as Nipuna, the BPO arm of th
