Friday, January 16, 2009

Satyam Saga: Denied board seat, Lazard to exit Satyam; sells 5.3%

Miffed over the uncertainty over the government granting a board seat in Satyam Computer, investment bank Lazard has sold a larger portion of its stake in the software firm yesterday and may sell the rest in the next few trading sessions. Lazard, which emerged as the biggest shareholder in Satyam with roughly 7.4% after market purchases over the last week or so, sold shares amounting to 5.3% of the company’s total equity.

The decision by Lazard to exit Satyam follows the government’s announcement on to appoint Confederation of Indian Industry, chief mentor Tarun Das, former Institute of Chartered Accountants of India president TN Manoharan and LIC’s S Balakrishan to the company’s board. The government, last week, had appointed HDFC chairman Deepak Parekh, former Nasscom president Kiran Karnik and former SAT presiding officer C Achuthan as board members of the company.

There has been competition for a seat among several institutional investors, including Lazard. The feeling is that since LIC has been given a board seat, other institutions may not be entertained.

Another person close to the development said the move by Lazard to exit Satyam would prompt other institutional investors also to sell the stock.


No comments: