Satyam Computer Services, India’s fourth-largest software exporter, has kicked off its roadshow to drum up investor interest for its proposed sale of up to $130 million of American Depositary Receipts (ADR) to be listed on the New York Stock Exchange (NYSE).
With pricing expected on Tuesday, May 15, Satyam plans to sell 25 million shares, equivalent to 12.5 million ADRs. In its statement to the Stock Exchange of Mumbai (BSE) the company said it anticipates that the price of the ADR will be determined with reference to its equity shares listed in India on the BSE, the National Stock Exchange and the Hyderabad Stock Exchange. Business press in India have quoted sources as saying they expect pricing to reflect a premium of up to 10% over the domestic prices. The stock ended today (Thursday) at Rs227.4 ($4.8) on the BSE.
The underwriters may also purchase up to an additional 1.875 million ADRs representing 3.75 million equity shares to cover over-allotments within 30 days of the pricing of the offering.
If successful, Satyam will become the third Indian information technology company to be listed on the NYSE, after Silverline Technologies and Wipro listed there last year. Other Indian companies listed on the NYSE include financial services company ICICI and its ICICI Bank subsidiary. Satyam Computer Services’ subsidiary, internet service provider Satyam Infoway, is listed on NASDAQ but not in its home country.
Satyam’s stock has been on a rollercoaster ride over the past 12 months. It hit a high of Rs7230 in July last year before dropping sharply to a low of Rs160 in April. Since then it has rebounded somewhat, trading regularly around the Rs240 mark.
Satyam Computer Services has a presence in 35 countries and a customer base of over 200 global clients, including around 30 Fortune 500 Corporations.
Merrill Lynch is managing the sale and Bank of America, CLSA, Deutsche Bank and Salomon Smith Barney round out the syndicate.
