Mahindra Satyam to declare audited nos by June 2010

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Mahindra Satyam to declare audited nos by June 2010

Vineet Nayyar, Executive Vice Chairman, Mahindra Satyam outlines the reasons for the company not being able to report audited numbers earlier.

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Excerpts from Midcap Radar on CNBC-TV18 Watch the full show » RELATED NEWS Satyam says no out-of-court settlement with creditors Mahindra Satyam has good support at Rs 88: Mohindar Sell Mahindra Satyam: Sandeep Wagle Mahindra Satyam: No more attrition from existing customers CBI pegs Satyam scam losses at Rs 14000 cr ALSO READ See latest News about Mahindra Satyam See previous management interviews See what other Experts & Brokerages are saying about Mahindra Satyam Mahindra Satyam BSE | NSE 31/05/12 Are Mutual Funds betting on Mahindra Satyam?

Q: You mentioned that perhaps the liabilities were much more when the promoters bought it. What is the nature of these liabilities? Are these contingent liabilities which means there are law suits pending, is it liabilities that the clients are asking for their money back. Could you put a percentage on it, are the liabilities 100% more, 200% more, ten times more?

A: I am glad you asked this question because you clearly misunderstood what I was saying. What I said was that when we went in, there was a certain uncertainty about the liability, which has now been quantified and which is now coming up. That quantification was not available earlier. But we do believe that all these liabilities are well within our capability to discharge and which we will as we go long.

We are not talking about other than class action suit and two other litigations which you know about, there are no major liabilities. We discovered there were certain liabilities in regard to real estate, we discovered some electricians hadn't been paid, we discovered some travel bills hadn't been paid. Those have been paid and most of these liabilities have now been discharged.

Q: There has been some confusion out there whether creditors will get paid or some creditors are getting out. This is a class action law suit which means it will continue as long as there is one creditor out there. Do you have some dates onto when this class action law suit will be decided and if for some reason the decision goes in your favour, can it be appealed, can it go to a jury, what exactly happens as the next stage from this point onwards?

A: A couple of things about class action suit; firstly, almost all the suits have been consolidated. They are being adjudicated by Judge Jones in the District of New York.

Secondly, I cannot say how long this will take but I can tell you the normal run. The normal run of the case is about three years. 99% of these cases never go to trial, they are settled beforehand. We may not fall into any of these patterns but I am just giving you the averages.