Satyam Wins golden peacock award for excellence in Corporate Governance on Global level for 2ndtime.
United Kingdom Trade and Investment India Business Award for Corporate Social Responsibility
Satyam Clients A total of 650+ Clients 185 of the top fortune 500 Companies
Satyam Board Structure Other Independent Directors B.RamaRaju Promoter & CEO B.RamalingaRaju Promoter & Chairman Ram Mynampati Whole time Executive Director SrinivasVadlamani Chief Financial Officer Dr M. Srinivasan Prof. Krishna G Palepu Mr. Vinod K Dham Mr. T R Prasad Prof. V S Raju Prof. M Rammohan Rao ISB Dean/ Bharat electronics Sasken Communication/ Hellsoft /Montalvo Systems and Newpath GTB/Dr. Reddy’s Laboratories Former CabinetSecretary /GMR Infra/ GVK Taj
Satyam – Share holding Pattern Institutional & Non-Institutional Shareholders LIC 4.34% L&T 4% Lazard Aberdeen 13.16% Fidelity ICICI Prudential Citigroup JP Morgan Total Market capitalization was Rs. 15,262 Cr (still Dec 16, 2008 )
Time-Line 16 Dec 2008 17 Dec 2008 26 Jan 2009 Satyam gets board approval for controlling stake in Maytas Infrastructure and Maytas properties as fully owned subsidiary for $1.6B (Rs. 8000 Cr.) Satyam backs out of Maytas deal citing investors protest Major Clients of Satyam express dissatisfaction. Contracts worth $200 million up for grabs Satyam shares plunge 55 percent in NYSE. BSE share plunges over 30% Board meeting to be held on Dec 29 for proposed buyback of shares
Time-Line 19 Dec 23 Dec 206Jan 2009 20 Dec World Bank bans Satyam for 8 years due to inappropriate payments to staff and inability to provide information sought on invoices British mobile solution provider Upaid files a law suit against Satyam in a district Court in the US over Maytas deal. May face $1 Billion in penalties Centre refers Satyam deal to Registrar of Companies (RoC)
Time-Line 26 Dec 28 Dec 26 Jan 2009 29 Dec 3 more Independent Directors resign. Mendu Rammohan Rao, Krishna G Palepu and Vinod K Dham Board meet initially scheduled for 29th postponed to 10th January 1st independent director Dr. Mangalam Srinivasan resigns from Satyam board Board announces exploring option for buyback of shares to restore investor confidence Rumors in market about strategic takeover by IBM, Accenture Satyam asks DSP to review board structure Satyam objects to world bank statements, asks to apologies or face legal action IL&FS sells 44.1 lakh shares pledged shares of Satyam promoters in 1 day. Promoters equity reduced from 8.6% to aprrox 7% Promoters disclose that their entire holding in Satyam pledged with institutional lenders since 2006
Time-Line 30 Dec 02 Jan 26 Jan 2009 03 Jan Satyam board confirms promoters stake to be around 5%. Further 3.2% still pledged. Post cancellation of deal, Maytas looks for raising $500 million through sale of equities and properties IL&FS sells further 44.27 Lakh pledged shares taking the tally to 1.5 crore pledged shares Satyam-Upaid case hearing over the Maytas deal in Texas court on January 8.
Time-Line 05 Jan 06 Jan 26 Jan 2009 Tech Mahindra (Revenues 3766 Cr.) offers to merge with Satyam (Revenues 8473 Cr.) Total pledged shares sold by IL&FS reaches 2.5 Cr. in last 13 days. Promoters stake down to 3.6%. Still a further 1.7% are pledged Promoters stake in the company down to 4.5% The Night Before 7th Jan Merill Lynch discovers serious irregularities in books of accounts and approaches regulator SEBI for further course of action and its inability to investigate further. DSP submits report to SEBI and Satyam management late night. SEBI considers proposal to make it mandatory for promoters and majority share holders to disclosed pledged shares to stock exchange
Time-Line 07 Jan 26 Jan 2009 09:45 A.M. Satyam Chairman Ramalinga Raju wrote letter to the company board Hunt for Raju brothers begin. Amid speculation over his whereabouts, Raju is believed to have left for the United States in connection with a court case. ADR’s crash 90% Satyam BSE scrip falls 78% DSP snaps ties with satyam. Ram Mynampati takes over as interim CEO according to Raju’s letter Auditing firm PWC under scanner Satyam stripped of Golden Peacock award Govt. instructs RoC to review report NSE removes Satyam from its benchmark index Nifty.
Time-Line 08 Jan 09 Jan 26 Jan 2009 10 Jan BSE to replace Satyam Computer with Sun Pharmaceutical in its benchmark index Sensex with effect from January 12. PwC in major trouble. Stocks of PwC clients take a major beating at the BSE and NSE Former CFO ValdamaniSrinivas remanded to judicial custody CFO ValdamaniSrinivas, who is the financial custodian of the company resigns Raju brothers arrested by the police on charges of criminal conspiracy, cheating, forgery, misappropriation of funds and criminal breach of trust. PwC shot back at Satyam, saying in a media statement that the auditing was based on the audit evidence provided by Satyam and in was accordance with applicable standards. Market Capitalization of satyam falls to Rs. 1,607 Cr from Rs.15,262 Cr. on Dec 16 in 19 trading sessions.
Time-Line 15 Jan 13 Jan 14 Jan 16 Jan 26 Jan 2009 Government hands satyam case to SFIO Maytas stocks hit the lower circuit for 7th consecutive trading session 23 year old employee of satyam commits suicide in Chennai The newly appointed 3 member board appoints auditing firm KPMG and Delloitte to assist it in cleaning the mess in the scam tainted company’s accounts The government expanded the three-member Satyam board to six to include S Balakrishnan of Life Insurance Corporation, Tarun Das, chief mentor of the Confederation of Indian Industry and T N Manoharan, former president of the Institute of Chartered Accountants of India
Action Taken By Authorities Chartered accountants body ICAI constituted a six-member special committee to look into the auditing of crisis-hit Satyam Computer and will submit its auditing report on February, 11. The special committee will headed by ICAI Vice-President UttamPrakashAggarwal . ICAI council members – S L Dogra, Amarjeet Chopra; SubodhAggarwal ; Akshay Gupta ;& K R Maheshwari, a banker and chartered accountant. Government asked the Serious Frauds Investigation Office (SFIO)-- a body set up to crack complex white collar crimes-- to probe the financial irregularities in Satyam Computer Services and report its findings in three months.
This decision to refer Satyam to SFIO is based on the recommendation of the Registrar of Companies (RoC) in Hyderabad, who inspected the books of Satyam which were being fudged for the past 7 years.
Raju was arrested on charges of cheating, fraud and and other criminal charges under various sections of Indian Penal Code (IPC).
The Securities and Exchange Board of India (SEBI) officials came to Hyderabad to investigate the entire scam, but they could not do so as Raju was in the custody of CID.
The former chief executive officer (CEO) of Satyam Computers, Raju and his younger brother Rama Raju were remanded to judicial custody by sixth additional Metropolitan magistrate for 14 days (ie till January 23) and both were shifted to Chanchalguda Central Jail near the city.
Liquidating assets and bringing in new investors. DELOITTE and KPMG has been appointed as independent auditors to help restate the company’s financial reports. Government superseded the board of Satyam and decided to appoint 10 nominee-directors. DEEPAK PAREKH set to be appointed Chairman (Chairman of HDFC ltd and HDFC bank), KIRAN KARNIK and CACHUTAN (legal expert). 3 members of BCG has been appointed as a management advisor and is working to revive satyam. TARUN DASS (CII Mentor), TN MANOHARAN (former president of ICAI) and SB MAINAK are among other 3 board members appointed by the Government. Satyam board has appointed GOLDMAN SACHS & AVENDUS as its Investment Bankers. SEBI and government of India devise appropriate fair and transparent measures for enabling open bids.
Why Govt. Mediated Govt. of India was very concerned about it’s Image in International Market especially IT , as it is also main source of foreign exchange for the country and drives economic growth of a country. Tosafeguard the Interest of small investors, So that faith can be restored in the market again. To take care of the employees working in Satyam. As it was never their fault for whatever happened. Their job has to be secured by the Govt. that too in economic recession time.
Steps Taken After Satyam Fraud Introduction of new rules by the stock market regulator, making it compulsory for promoters of companies to disclose the percentage of shares pledged by them to lenders Appointment of Independent Auditors and Company Secretary by Company Law Board to conduct Audit of any private organization and time. Set-up of 5 member Committee to suggest how to implement effective compliance and Corporate Governance in private sector by CLB.
Finally Satyam acquired by tech mahindra…. Anand Mahindra, Chairman, Tech Mahindra, the new owner of Satyam, company post the Rs 2,890-crore takeover, giving hope and future to Satyam’s 45,000-50,000 employees. A moment of truth for Satyam and a victory for the government and the regulators.
32 RajuRaju sat on the wall,RajuRaju had a great fall,Balance sheet died,Shareholders cried,RajuRaju made a fraud. RajuRajuYes Baba,Cheating usNo Baba,Telling LiesNo Baba,Open the balance sheetHA! HA! HA! B. RamalingaRaju Founder & Chairman, Satyam Computers Ltd. Thank You !