The strategic investor in Satyam Computer Services may end up with a majority stake in the company with the board keeping options open for a preferential allotment above 26 per cent of paid-up capital, according to a board member.

The Satyam board is likely to approach the Securities and Exchange Board of India (Sebi) for finalising the size of the allotment and floor price.

"The minimum preferential allotment is decided at 26 per cent of the paid-up equity. However, it may go above that level. I can not reveal how far it may go up by," a Satyam board member told Financial Chronicle.

Some potential investors have indicated that they would want to own at least 51 per cent of Satyam. If the preferential allotment is around 31 per cent, the successful investor can own 51 per cent post open offer of 20 per cent.

However, Larsen & Toubro (L&T), the much-touted front-runner in the race for Satyam, already owns a 12 per cent stake in it.

"You will have to wait for a few days for clarity on these matters. We have certain prescribed conditions and whoever fits the bill will get to buy Satyam," the board member said.

The board of directors is likely to arrive at a decision regarding the final size of the preferential allotment in its board meeting scheduled towards the end of next week.

Regarding the pricing of the preferential allotment, the member said, "We will do so in consultation with Sebi."

The price for preferential allotment is likely to be fixed at a slight premium to the present market price of Satyam shares, said Arun Kejriwal of Kejriwal Research and Investment Services.

Assuming that the preferential allotment occurs at Rs 50 (at a 10 per cent premium to the last traded price of Rs 45.45 on the Bombay Stock Exchange), the strategic investor will have to pay Rs 3,570 crore, to buy 51 per cent stake (71.5 crore shares post preferential allotment). For a preferential allotment of 26 per cent, the strategic investor will have to pay Rs 1,820 crore.

The present paid-up equity capital of Satyam is Rs 134.6 crore, spread across 67.3 crore issued shares. The Company Law Board has recently approved an increased in the authorised capital from the present Rs 160 crore ( 80 crore shares of Rs 2 each) to Rs 280 crore (140 crore shares of Rs 2 each).