Satyam board decides to invite strategic investorBy IANS
Saturday, February 21, 2009
HYDERABAD - Fraud-hit Satyam Computer Services Saturday decided to invite a strategic investor to keep India’s fourth largest software outsourcer running, and will soon announce the details of the process it has adopted for the purpose.
The decision was taken at a meeting here of the central government-appointed board of directors.
‘The board today (Saturday) approved the process to be followed for inviting a strategic investor and decided to seek regulatory approvals early next week. Upon receiving these clearances, the board would announce the process to be observed,’ Deepakh Parekh, one of the directors, said after the meeting.
The board’s approval of the process follows clearance from the Company Law Board Feb 19 of the Satyam’s proposal to sell at least 26 percent stake to a strategic investor.
Satyam said in a release that the board had also decided to remove Price Waterhouse as the company’s statutory auditors and appoint new auditors.
‘The board had recommended to the ministry of corporate affairs for the removal of Price Waterhouse (PW) as the statutory auditors of the company and notified PW. PW has tendered its resignation to act as statutory auditors of the company. The company is now intending to appoint new statutory auditors,’ the release said.
‘The board authorised its CEO A.S. Murty to finalise and implement a retention plan for its key employees (in consultation with Boston Consulting Group and Special Advisors) and endorsed actions now underway to fine tune the expenditure and profit optimisation plan,’ the release quoted another board member C. Achuthan as saying.
On the use of funds, another director T. N. Manoharan said: ‘We are using the bank funding in a controlled and phased manner to meet immediate and near-term operating requirements, including payments to vendors. The good news is that we are receiving unsolicited offers from banks for funding.’
Saturday’s meeting was the seventh since the government appointed the new board Jan 10 after sacking the Satyam board following founder B. Ramamlinga Raju’s confession to committing financial fraud of Rs.70 billion (Rs.7,000 crore), the biggest corporate scam in India.
Homi Khusrokhan and Partho Datta, special advisors to the board, attended the meeting.
The release quoted board chairman Kiran Karnik as saying: ‘The board is satisfied with the progress of the company’s stabilisation programme and appreciated the sustained efforts of Satyamites that has helped the company’s revival on a fast track mode.’