Mahindra Satyam gives up land to Gujarat govt

Three years after B Ramalinga Raju, former chairman of Satyam Computer Services Ltd (now Mahindra Satyam), had announced an IT-ITeS park in Gandhinagar, the company has abandoned the project and surrendered 26 acres of land it had purchased from the Gujarat government. The company is waiting for a formal clearance from the state government.

"Some officials of Mahindra Satyam were in Gandhinagar sometime back to surrender the 26-acre land to the state government. They probably need the funds," said a senior official in the state information technology department, on condition of anonymity.

Shivanand Raja, head-corporate services, Mahindra Satyam, confirmed in response to an email query about the land that, "...representation of Mahindra Satyam for surrendering the land is under consideration with the government of Gujarat. The size of the land is 26 acres, located in Gandhinagar Township and the same was purchased in July 2008 at a total cost of Rs 11.5 crore (Rs 44.23 lakh per acre)."

The cost of the proposed project was estimated to be Rs 60 crore (Rs 600 million), of which the company had paid Rs 11.5 crore (Rs 115 million) for land.

While Raju had announced to set up an IT park in Gandhinagar at an Info-Tech Summit in December 2006, the company later conveyed to the IT department that it wanted to convert it into a special economic zone. "The purpose of buying the land was to set up an IT and ITeS SEZ," Raja wrote.

Commenting on the use of proceeds from surrendering the land, Raja said: "The decision will be taken by the company." He added that while Mahindra Satyam had no plans in Gujarat, the company "could explore any possible opportunities based on the business outlook, in the future".