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The Andhra Pradesh High Court has directed that an independent auditor be appointed to scrutinise the scheme of amalgamation of Mahindra Satyam, Tech Mahindra and a few other Mahindra group companies.
Justice P. V. Sanjay Kumar gave the order after the Official Liquidator suggested to the court that there was a need for close scrutiny by an independent auditor.
Complex deal
The Official Liquidator had expressed inability to scrutinise the accounts and the scheme of amalgamation given its complexity.
The court wanted the report of an independent auditor to be submitted by January 4.
The scheme of amalgamation proposes merger of Venturbay Consultants Private Ltd and Satyam Computer Services; and C&S System Technologies Private Ltd , Mahindra Logisoft Business Solutions and CanvasM Technologies with Tech Mahindra Ltd .
As per the scheme, Satyam Computer Services would be amalgamated with Tech Mahindra, consequent to the amalgamation of Venturbay Consultants with the latter. Satyam shareholders will get 1 share of Tech Mahindra (of Rs 10 each) for every 8.5 shares of Rs 2 each.
Questions ratio
Incidentally, the High Court is hearing another plea by some minority shareholders of Satyam who had questioned the swap ratio for the merger. They alleged that the ratio favoured Tech Mahindra.
The court’s decision to appoint an independent auditor came in the backdrop of the complex financial accounts of the five companies.
The issue of massive financial fraud too contributed to the complexity.
Keeping this in mind, the court has ordered for independent scrutiny.
Nod
The company moved the High Courts of Andhra Pradesh and Maharashtra after getting the approval of the respective shareholders and the Boards. The company had received the nod from the Maharashtra court.
>kurmanath.kanchi@thehindu.co.in
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