L&T, Tech Mahindra, Spice put in EoI for Satyam; Hindujas pull out

The government appointed Satyam Computer Services board will now meet tomorrow to scrutinize the Expression on Interest (EoI) submitted by potential bidders for the company. The Hindujas, however, have pulled out of the Satyam race citing the unquantifiable legal liabilities of the Hyderabad-based company. "We would rather wait for the restated accounts and status of legal liabilities of the company. That's why we did not register today," a top Hinduja official told ET. The official said the legal liabilities of upto $840 million makes it a big risk factor for the group to make any bid for Satyam. "Even if we get the company for free... we would think twice," the official said asking not to be quoted. The last date for Satyam suitors to register today expires today at 5 pm (IST). The source said it would be better to sell Satyam after the company restates its accounts and settles its legal liabilities. "If we take into account the return on capital employed and the free cash flow of Satyam, then it makes the company quite unattractive," he said. The official deadline to submit the bid and proof of adequate funds is March 20. Satyam has been in turmoil since founder B. Ramalinga Raju confessed on January 7 that he overstated the company's profits over several years and created a fictitious cash balances of more than Rs 7,000 crore. Based on the evaluation of bids, the Satyam board will induct a strategic investor to take management control of the firm.