Satyam’s disgraced chairman Ramalinga Raju had made an emotional pitch that the company faced a takeover threat from IBM, to avert which he wanted the board’s support to diversify into other areas.
Returning from the US ahead of the December 16 meeting, at which the company decided to go in for the Rs 8,000 crore acquisition of two companies related to his family, Raju had told the board that IBM and another company were going to take over the Indian information technology company firm because of its strong cash balances, a member present at the meeting said.
Raju also warned that after the takeover of Satyam, pink slips could be issued by the acquirer to enhance profits, the member said on the condition of anonymity.
To avoid this, Raju urged the members, in an informal pitch before the meeting commenced, to take what is known in the corporate world as a ‘poison pill’. His suggestion was that Satyam should enter sectors where IBM and others of its kind would have no interest.
Subsequently, the board was given presentations on Maytas Infra and Maytas Properties with the valuation, an issue on which some members, though they agreed in principle, wanted more clarity and said the company should adhere to certain basic parameters before going ahead with the deal.