MUMBAI (Reuters) - Satyam Computer Services, the company snared in India's biggest corporate scandal, is set to announce a winning bidder for a controlling stake, but buyers face a difficult task in valuing the firm due to uncertainty about its finances and liabilities.
The government-appointed board meets at 9.00 a.m. (0330 GMT) to receive bids and unveil the buyer for a 51 percent stake in the outsourcing company, last valued at around $640 million in the market.
Three months ago, Satyam's founder and chairman shocked investors by saying profits had been overstated for years, and put in doubt the survival of the company once ranked as India's fourth-largest software services exporter.
The government quickly stepped in and sacked the board to limit damage to India's once-shining IT services sector.
Indian engineering conglomerate Larsen & Toubro, which has a small software services unit, mid-sized outsourcer Tech Mahindra and U.S. private equity firm WL Ross & Co are among the suitors.
With a 12 percent stake in Satyam, Larsen & Toubro is seen by many analysts as a front-runner.
Indian media have reported IT services provider Cognizant Technology Solutions has also joined the race to acquire Satyam. A spokesman for the U.S. company had declined to comment to Reuters on market speculation.
New York-listed Satyam's market value has plunged to around $640 million from $7 billion in May. The stock ended at 47.15 rupees (90 U.S. cents) on Thursday, down more than 90 percent from its last year's high of 544 rupees. Indian markets were shut on Friday.
Analysts said Satyam looks attractive due to its long list of marquee clients and after the plunge in its market value caused by the $1 billion-plus fraud.
However, they are unsure how to value the company due to uncertainty about its accounts and legal liabilities arising from lawsuits filed in the United States by its shareholders.
In October, Satyam had said it had around 53,000 employees and more than 600 clients including General Electric, Cisco Systems and Qantas Airways.
(Writing by Anshuman Daga; Editing by Jean Yoon)