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Satyam lists at $9.71 on NYSE; raises $140.8 million

Satyam Computer Services, India's fourth-largest provider of IT services said on Tuesday it raised at least $140.8 million by selling American Depository Shares which began trading the same day on the New York Stock Exchange.

Satyam said the ADS were sold for $9.71 apiece, almost at par with the domestic shares' market price.

The ADS first traded at $11.16, a 14.9 per cent premium to the offer price.

Satyam's shares closed up 1.5 per cent at Rs 228.20 on Tuesday at the Bombay Stock Exchange, where they were the most heavily traded issues. Each ADS is equivalent to two regular shares.

Satyam said in a statement it offered 14.5 million ADS, excluding a 15 per cent over-subscription option. It had earlier filed with the SEC to offer 12.5 million ADS and 1.875 million more if demand warranted.

Satyam, headquartered in Hyderabad, an emerging technology centre, provides software services to over 300 clients including General Electric, Sony Corp and Ford Motor Co.

The listing will enhance Satyam's stature in its top market, the United States, where other Indian software majors Wipro Ltd and Infosys Technologies are already listed.

Altogether nine Indian companies, including Satyam's subsidiary Satyam Infoway, are listed in the United States.

"Satyam could use the money to repay some of its debt and offer dollar-linked stock options," Ajay Mathrani, an analyst at ASK-Raymond James, said. "The listing will give them a global profile."

In addition to repaying part of its debt estimated at Rs1.5 to 2.0 billion ($32-$42 million), analysts expect Satyam to use cash and shares to pay for possible acquisitions.

Satyam's ADS listing comes about seven months after the Indian government approved its $310 million issue. The timing of the ADS is prompted by the rebound in tech stocks in the past month, analysts said.

Satyam's net profit surged 134 per cent to Rs 3.16 billion in the year ended March 2001, on sales that soared 83 per cent to Rs 12.42 billion.

North America accounted for 75 per cent of Satyam's revenue in its fourth quarter.

Satyam has a staff of about 8,400.

Satyam's ADS is being underwritten by Merrill Lynch & Co, Deutsche Banc Alex Brown, Banc of America Securities LLC, Salomon Smith Barney and CLSA Emerging Markets.

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