Satyam to delist ADRs from NYSE

HYDERABAD: In a clear indication that its restated acounts will not meet international accounting standards , Mahindra Satyam on Friday said it will delist its ADRs (American Depositary Receipts) from the New York Stock Exchange (NYSE) in October. The company said it will not be able to meet the extended deadline of October 15, 2010, for submitting results for financial year ending March 31, 2009, to the US bourse.Satyam — in 2001 — was one of the earliest companies to get listed on the US bourse and had burst forth into the big league.
The restated accounts for the Indian bourses — which are not so rigorous in its requirements — will however be unveiled at the end of the month. But analysts said that the move has put a question mark on the quality of restatement for the Indian bourses. "It must be with great difficulty that Mahindra Satyam will produce an accounts book and profit and loss statement. A lot will be based on presumptions and assumptions, I guess," a market analyst said.
Mahindra Satyam, in a statement, said that it would submit its delisting plea with the US market regulation Securities and Exchange Commission (SEC) on October 4, 2010, or around that time and the delisting would be effective by October 14, 2010.
According to sources, the decision to delist was taken after the company's plea seeking more time was turned down by the US bourse. Company sources, however, sought to softpedal the issue by arguing that the delisting move will suit Mahindra Satyam because eventually it would be merged with Tech Mahindra which is not listed on foreign bourses.
Putting the blame for the delays in filing its results on the US bourse squarely on the misdeeds of Satyam's former promoters Ramalinga Raju and co-Mahindra Satyam chairman Vineet Nayyar on Friday said in a statement: "Due to our late SEC filings, which are among the unfortunate results of the misdeeds of the former management , we are delisting from the NYSE."
Analysts, however, said the move did not augur well for US investors, some of whom have dragged Satyam to court after the scandal broke in January 2009. "Satyam's ADRs have already fallen in anticipation of the delisting, which is not a good move from the perspective of the international investor," said V K Sharma, head of business (private broking and wealth management), HDFC Securities.
End Of NYSE Stint
In 2001, Satyam became one of the earliest companies to get listed on NYSE
Mahindra Satyam would submit its delisting plea with the SEC around Oct 4, 2010 and the delisting would be effective by Oct 14.