In addition, Satyam has also acquired an option to purchase the remaining 75.5 per cent of the outstanding shares of IndiaWorld at any time prior to June 30, 2000 for an exercise price of $87 million (Rs 377.50 crore).

Once Satyam buys out the entire 100 per cent stake, the acquisition will cost around Rs 499 crore (around $ 115 million), making it the largest takeover in the booming Indian information technology sector.

IndiaWorld website registered an aggregate of 13 million page views in October 1999, most of them coming from outside India, the statement said.

The two-step cash transaction which would eventually result in the integration of India World's popular websites with Satyam Infoway's portal www.Satyamonline.com.

IndiaWorld's websites, very popular withoverseas Indians (NRIs) worldwide, include www.samachar.com (covering India related news), www.khel.com (dedicated to covering cricket), www.khoj.Com (the premier Indian search engine), www.bawarchi.com (providing more than 3000 Indian recipes) and various other sites focussing on niche areas of interest to overseas Indians.

R Ramaraj, chief executive officer of Satyam Infoway, said that coupled with the kind of traffic the IndiaWorld portal attracts, "we now have an overpowering presence with 26 million page views per month." Satyam is the largest private Internet Service Provider (ISP) and claims a subscriber base of 100,000 people across 30 cities in the country.

Ramaraj said that ``IndiaWorld is a perfect fit for Satyam Infoway. Satyam Online is already a very popular portal in India with focus on purposeful browsing. In e-commerce the new joint venture with Bank of Madura is focussed on providing financial services and e-commerce to Indian interest audience overseas.'' ``IndiaWorld with its dominantaudience overseas would provide that perfect first to make Satyam the portal of choice for India,'' he said.

Satyam infoway's portal www.Satyamonline.com, which includes several popular websites such as www.walletwatch.com, www.carstreet.com, www.carnaticmusic.com is focussed on providing content and facilitating e-commerce services primarily to Indians resident in India. The portal registered an aggregate of 13 million page views in October 1999, a substantial part coming from within India, making it one of the leading portal networks dedicated to serving the needs of Indians in India. ``The acquisition would be a good strategic fit to Satyam Infoway's portal business adding a large `overseas Indian audience' to the large India based audience that www.Satyamonline.com currently enjoys. The combined portal network is expected to be a mega portal for India interest audience in India and elsewhere,'' Ramaraj added.

IndiaWorld has been in the business for over five years now. Said Rajesh Jain, managingdirector, "It has been a profitable business for the last three years." IndiaWorld reported a pre-tax profit of Rs 27 lakh on a turnover of Rs 1.3 crore during the last fiscal.

Satyam Infoway had launched an American depository receipt (ADR) issue earlier this year and listed its shares on the Nasdaq stock market of the US.

The company has been looking for expansion through acquisitions after launching the ADR issue. Satyam ADRs had already appreciated by about $ 26 to $ 106 last Friday ahead of the deal. On Monday, trading in the ADR resumed with a $4 rise, but closed lower at $ 103.62.