Sebi probes surge in Tech Maha shares before Satyam deal

Market regulator Sebi has initiated a probe into the sudden spike in the shares of Tech Mahindra minutes before the Satyam announcement was actually made. CNBC-TV18's Vivek Law delves deeper.What has been learnt recently is that the market regulator, Securities and Exchange Board of India (Sebi) is examining this sharp spurt—22% in nine minutes. This was well before the news was actually publicly available on all the channels. Though that news, too, was source based. But the fact of the matter is that the stock jumped 22% in nine minutes between 11:35 am to 11:44 am, and, more stunningly, it jumped 12% in barely three minutes. The market regulator has launched a probe. Stock exchanges are independently verifying who were the buyers at this point of time; did they know something that the rest of the market didn’t know? The regulator wants to have a close look and whether price sensitive information such as this was leaked that day.As we know the key issue at this point is a Sebi approval. Now Sebi is quite satisfied with the manner in which the process has gone through. Several board members of Satyam were in regular touch with Satyam periodically, explaining to the regulator about the process. This was as we know a contingency kind of a situation, which the regulator allowed, not to make an open offer, relaxed various norms.
Now, what I learn is that the open offer, the offer document that will be released by the company concerned once it is approved by Sebi, the regulator is examining whether critical information that formed part of the data room, which has been revealed to several bidders who came and visited the data room should also now be disclosed to shareholders at large. The reason being there is no other information that is coming out of Satyam as we know. The accounts haven’t been restated, account statements haven’t been disclosed on a periodic basis, are unlikely to at least for another six months is what we’ve understood.
So the regulator is keen that more information, as much as possible can be disclosed to shareholders in this offer document.Commenting on a similar query, Deepak Parekh, Satyam Board Member had said, "Accounting firms are still at it. We are trying to get the accounts restated for the past five-six years. So, they are starting from 2009 last quarter then 2008. Their work is still in progress. They will still take a few months more. So, we cannot really release anything on the accounting side. But subsequently, after the entire process is over, whatever information we had in the data room, which was privileged information for the four bidders, that could be made public to the other Satyam shareholders. But that is entirely the call of the winning bidder.Now, that the CLB has given its formal nod and we do understand on Monday, Tech Mahindra is going to be meeting the Satyam board, it remains to be seen whether they actually do decide to disclose certain more additional information to Satyam shareholders who have been pretty much starved of basic information of what is going on in the company.