Indian banks have given $676 mln to Maytas- papers

From : Reuters

Indian banks have given $676 mln to Maytas- papers

Fri Jan 16, 2009 11:53pm EST

 

MUMBAI, Jan 17 (Reuters) - State-run Indian banks have lent 33 billion rupees ($676 million) to Maytas Companies, which have interests in property and are controlled by the family of fraud-hit Satyam Computer Services (SATY.BO), the Times of India reported on Saturday.

Citing an unnamed finance ministry official, the paper said most of the funds have already been given to the firms via loans and bank guarantees.

Maytas -- Satyam spelt backwards -- companies include Maytas Properties and Maytas Infra (MAIL.BO).

Maytas Infra shares have tumbled around 75 percent since Dec. 16, when Satyam announced plans to buy it and Maytas Properties for $1.6 billion cash before abandoning the plan under shareholder pressure.

Satyam, India's No. 4 software services exporter, has been battling for survival since chairman Ramalinga Raju suddenly resigned last week, revealing profits had been falsified for years and that $1 billion of cash on the books did not exist.

See [ID:nDEL354794] for a related story.

Separately, the Economic Times reported the government has assured state-run banks that it will allow them to take over pledged properties and invoke guarantees if these firms failed to service loans, citing an unnamed finance ministry official.

"The loans are fully secured and the banks are in posession of securities worth 27 billion rupees," the official told the financial daily.

Satyam's shares ended up 20.4 percent at 24.45 rupees on Friday, but the stock is still down more than 85 percent since the massive fraud was revealed. ($1=48.8 rupees) (Reporting by Saikat Chatterjee; Editing by Ben Tan)

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