Satyam to buy back shares

Satyam Computer Services Ltd on Thursday exercised its second option of buying back its shares after being forced to cancel plans to pick up 51%in Maytas Infra and 100% in Maytas Properties.Details of the conference call made by fund managers with Satyam management on Tuesday revealed that every one of them opposed the deal for by passing minority shareholder approval.

The company informed stock exchanges on Thursday that its board would discuss the buy back proposal on December 29. The news helped to prop up the company’s be leaguered shares,which closed 7% higher at Rs 169.35 on the BSE. However, year on year, the value of Satyam’s stock has eroded by two-thirds.

Under existing provisions, a company can use 10% of its equity capital plus free reserves to buy back shares. Satyam had around Rs 7,350 crore as such at the end of March. So, of the total cash of around Rs 5,300 crore in its books, Rs 735 crore can be used for the buy back.

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