‘Brand Satyam’ may have to go, says board.
The Satyam board, which met here today, has begun the formal procedure to invite bids from potential suitors for the scam-tainted company. Satyam is yet to restate its accounts, but the government-appointed board feels the process should be hastened because potential buyers could lose interest.
"The board will come out with a bidding process in seven to 10 days. It's a work in progress but this needs to be done quickly," said Kiran Karnik, chairman of the board.
In a related development, P C Gupta, minister of corporate affairs, confirmed at a function in New Delhi that "...the next step of the government is to identify a suitable strategic investor who can take care and takeover the company". He added that the strategic investors could be a company or group of companies.
The board, meanwhile, is also understood to have reached a consensus that once the buyout is done, brand Satyam may have to be dispensed with.
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A representative of one of the suitors, Anand Vohra, CFO of Hinduja Global Solutions, told Business Standard: "The board should speed up the process and fix some milestones for the company. We have sent the letter of intent to the bankers. We would not mind taking a set of auditors and getting a rough estimate of the company. We would look at three main criteria — check if the company has a genuine set of customers, liability and what is the implication of pending case."
Cost-cutting: Meanwhile, Satyam's new CEO A S Murty has focused on cost-cutting. The company's administrative team sent a mail this morning to all the employees setting out cost-cutting measures, said sources close to development.
| UPDATE |
| * New Satyam CEO on cost-cutting spree |
| * Raju bros bail plea tomorrow |
| * Serious Fraud Investigations Office plea to be heard tomorrow |
| * Price Waterhouse bail plea on February 16 |
| * Maytas Properties CFO under police scanner |
The letter, among other things, stated that all couriers — within Hyderabad or outside — would require a regional manager (RM)-level approval and all international calls made using IP phone would be monitored. Only calls to clients would be allowed.
Bail pleas: The fourth additional metropolitan sessions judge today reserved the orders on an anticipatory bail plea filed by Satyam founder B Ramalinga Raju's brother and SRSR Holdings Director B Suryanarayana Raju for tomorrow. Suryanarayana Raju filed an anticipatory bail application earlier this week. Public prosecutor V Bala Buchaiah said anticipatory bail should not be granted to Suryanarayana Raju because he needs to be questioned. The police have received vital leads from V Gopalakrishnam Raju, general manager of SRSR Holdings, who is now out on bail.
The prosecution said that Gopalakrishnam Raju, who had admitted to have physically transferred some documents relating to transactions of Satyam and Maytas companies, had confessed to have acted on the directions of his employer.
Two others — Maytas Properties chief financial officer Badri and assistant manager Venu — are also under the police scanner for alleged involvement in transferring documents.
In a related development, the sixth additional chief metropolitan magistrate posted the hearing of bail pleas for Raju brothers and former chief financial officer Srinivas Vadlamani to tomorrow. All the pleas were scheduled to be heard today. Only counsel for Vadlamani appeared to present his case. With the counsel not appearing for Raju brothers, the public prosecutor asked the court to post the hearing of the three pleas to tomorrow.
The court will also pronounce its order on the Serious Frauds Investigation Office (SFIO) plea seeking permission to question the accused in the case tomorrow. The orders on the bail plea relating to Price Waterhouse partners and auditors S Gopalakrishnan and Talluri Srinivas are due on February 16.