Satyam Computer will acquire 51% stake in Maytas Infra and a 100% stake in Maytas Properties.

Satyam Computer ADRs took a huge beating, after its announcement. It will cost the company around USD 1.6 billion. It means that the company is using cash from its accounts for this acquisition. Satyam ADRs plunged 50.92% or USD 6.39 at USD 6.16.

The Minister of Corporate Affairs, Prem Chand Gupta has said that he will study the Satyam-Maytas deal and examine the details.

Investment giant Templeton said that they are totally opposed to this decision. “We do think that returning money to the shareholder was a better option,” said.

SBI MF and Reliance MF have voiced their note of dissent over the Satyam-Maytas deal.

Reacting to Satyam Computer’s move brokerage house CLSA said that the deal will likely go down as one of the worst corporate governance events in India. It added, “We are moving our rating from an Underperform to Sell. We consider this a major corporate governance issue. We see eroding focus, business momentum and market credibility ahead.”

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