Mah Satyam to pay USD 125 mn, settle US suit over fraud

Mahindra Satyam Ltd, a software servicing company, has agreed to pay USD 125 million to settle US shareholder litigation arising from a 2009 accounting fraud that turned into India's biggest corporate scandal.

The settlement does not cover various individuals including Ramalinga Raju, the company's founder and former chairman, according to settlement papers filed late Wednesday in the US district court in Manhattan.

Raju shocked investors in January 2009 when he said Mahindra Satyam had overstated earnings and assets for years, in a fraud estimated to exceed USD 1.5 billion.

The settlement would resolve claims that Mahindra Satyam misled investors about its business performance, court records show. A hearing to consider preliminary approval of the accord is set for February 24, the records show.