| The deck is cleared for $120 million American Depository Receipts (ADRs) issue by the Satyam Infoway, India's first private ISP, as the Finance Ministry of and Foreign Investment Promotion Board (FIPB) has approved its proposal to increase the size of its issue.
Satyam may be quick off the blocks to launch the offering in the US,
considering the fact that a few other Asian issuers, including some IT
companies from China and Hong Kong, are scheduled to hit the market over the
next couple of months, say inside sources.
Earlier, FIPB had permitted the company to issue 4.8 million share through
ADRs at a premium of Rs 490 per share. In addition to this Satyam has
decided to float 1.65 million shares. The premium on the shares of Rs 10
each has also been revised from Rs 490 per share to Rs 790 per share. The total issue is now estimated to mop up Rs 516 crore (about $120 million) on 6.45 million shares.
The ADR proceeds were expected to be utilized for setting up more
international gateways.. The additional funds would be used for acquisitions and infrastructure. The acquisitions might also
extend to companies with synergistic operations, including infrastructure providers, given the company's interest in setting up last-mile access links to consumers.
According to Satyam officials, the subscriber base of Satyam Infoway has a
subscriber base of 75,000 plus additional 70,000 of IGNOU students for who
Satyam Online access had been bundled alongwith courseware. The ISP
currently has 23 points of presence (POPs).
According to Pradeep Lakshmanan, vice-president of sales at Satyam, the company
is in the process of expanding its reach in terms of subscribers as well as
PoPs. It is looking to increase subscriber base to 200,000 across 50 centres
within this year. Hence the operations were expected to require around 10
gateways.
Additional gateways would also reduce the company's dependence on dedicated
lines leased from the Department of Telecom (DoT) to link non-gateway nodes
to gateways. The enhanced proceeds of the ADRs were likely to be used to
improve infrastructure.
Explosive stocks: July 2007::
bottom of the base of many stocks to form soon, and within a couple of months we I look at size of reaction based on shares traded vs float
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Stock Market Updates: November 2005::
Kingfisher Airlines to float public issue Kingfisher Air likely to fly first class soon gained 1.2% to Rs 409, while Satyam Computer Services rose
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Satyam will embrace direct selling as a new line of marketing and promoting
its Satyam Online brand besides channeling sales through retail outlets and
partners. Its first major-direct marketing initiative -- the OTS (opportunity to
see) campaign, which used mobile vans -- was recently carried out in Calcutta's
upmarket.
Satyam Infoway is a subsidiary of Hyderabad-based Satyam Computer Services Ltd. It has partnered with Sterling Commerce, CompuServe and Open Market Inc, of the US to provide end-to-end electronic-commerce and Internet services and products.
Product offerings range from basic messaging, EDI, Intranet solutions to Internet commerce and Web-based solutions.
Incidentally, Satyam Computer also plans to float ADR issue during the first quarter next year.
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