NEWS10 June 2009

Satyam in talks over Caterpillar MR buy

Asia Pacific Legal M&A

INDIA— Scandal-hit outsourcing firm Satyam is in negotiations with Caterpillar over $40m which it still has not paid for the acquisition of the construction equipment firm’s market research and analytics division.

Satyam agreed to buy the business from Caterpillar in April last year for $60m, but has so far only paid $20m.

The firm’s founder and former chairman B Ramalinga Raju admitted to a $1bn fraud in January, and the firm is now struggling to resolve disputes over four foreign acquisitions, according to a statement quoted in the Indian business press.

Following news of the fraud in January, Caterpillar served legal notice on Satyam demanding the immediate payment of the remaining $40m due under a promissory note.

Satyam said today: “In March 2009, the parties began negotiating to amicably resolve the outstanding issues and the settlement negotiations are at an advanced stage.”