Mahindra Satyam Chairman Vineet Nayyer said it will pay lead plaintiffs 25 per cent of any net recovery that it may obtain from PricewaterhouseCoopers (PwC)-related entities, which helped Raju, who confessed to fudging Satyam Computer accounts to the tune of Rs 7,200 crore.

After Raju's confession, the company's stock nosedived on the New York Stock Exchange, allegedly causing millions of dollars in losses to US investors. Since then, Satyam has been taken over by Mahindras.

Nayyer said, however, the company has not yet decided on the timeline and damage amounts for suing PwC. He did not rule the possibility of out-of-court settlement with PwC. Similarly, he said the company also plans to sue Raju and associates for the damages they caused to the company but did not elaborate on the timing and the damages to be sought.

Nayyer said the USD 125 million will be delivered to the plaintiffs once the US Court gives final approval to the settlement deal, which may take around four months.

"The USD 125 million will come from cash reserves which are at Rs 2,900 crore at the last count. So we don't see any problem in getting money. The amount will be put in an escrow account in a few days' time," Nayyer said.

"We will have to get the Reserve Bank approval. Once the approval from the judge comes, then this money will be transferred to plaintiffs and distributed," he added. As per a filing to the Bombay Stock Exchange, the settlement is exclusively for and on behalf of the company and does not affect the other defendants to the class action litigation.

According to Nayyer, the company was in negotiations with the plaintiffs for some time and the settlement may end all potential cases in the USA. He said the settlement amount includes lawyer's fees and taxes that may arise out of the payment.

According to a senior official of Mahindra Satyam, there were four lead plaintiffs in USA and one of them acted as the main party for the negotiations.

"All the complainants will have to agree to the settlement terms and no case will be entertained hereafter," an official said. The Indian software outsourcer is yet to settle a few investor suits such as Aberdeen Action in the US market.

Nayyer said the damages sought by it is small and hence can be settled out of court. Satyam share closed at Rs 63.60 on BSE, up 1.52 per cent over the previous close.