By IANS,
Hyderabad : Tech Mahindra, the new owner of Satyam Computer Services, Monday said the fraud-hit IT major would remain a stand-alone entity in the foreseeable future.
Excited about the prospects of the fraud-hit IT major, the buyer declared that restoring Satyam’s financial health will be its priority.
After the first meeting with the government-appointed board, Anand Mahindra, chief of Mahindra Group, said Satyam would remain a stand-alone unit in the foreseeable future and its leadership would continue with marginal changes.
“Satyam is going to be a very strong and viable entity. I don’t think it’s a sinking ship. No longer. It may not be a racing car yet that is what we want to make it one. I believe that Satyam is on a way to very viable future,” he told reporters after the interaction with the six-member government-appointed board.
Stating that there are still regulatory constraints, Mahindra declined to answer specific questions, especially about Satyam’s liabilities.
He expressed hope that the company would win back clients and clinch new deals.
Vineet Nayar, vice-chairman and chief executive of Tech Mahindra, said the new chief financial officer (CFO) would be named in the next few weeks.
The new buyer left it to A.S.R. Murthy to continue as the CEO of the company. Murthy, appointed as CEO by the government-appointed board, has expressed his willingness to continue.
Tech Mahindra said it was too early to comment on whether there would be lay-offs.
Mahindra said all the resources for buying Satyam were raised in a record 72 hours in the local market and largely through non-banking sources. “This is a strong signal to India that India is driving economy,” Nayar said.
Mahindra said Rs.700 crore was raised from internal accruals and partial funding was done via special purpose vehicle route.
Nayyar added that he was overwhelmed by quality of Satyam staff and their competencies. “They have the determination to take this company on successful path. The fact that they were able to retain major portion of business despite the Tsunami is an indication of their capabilities.”
Earlier, the board said an “open offer” would be announced Tuesday to obtain an additional 20 percent stake in the software major.
Deepak Parekh, a member of the board, said more financial details would be revealed in offer documents.
Tech Mahindra, which deposited Rs.2,910 crore in an escrow account Monday for a 31 percent stake in Satyam, will see its total holding increase to 51 percent after the open offer.
Satyam board chairman Kiran Karnik said the six directors, appointed to the board by the government, will continue in their posts till further orders from the Company Law Board. Tech Mahindra will appoint up to four more members soon.
Karnik said Tech Mahindra officials attended the board meeting as invitees as some formalities for the buy were not completed.
“Today, they came to the meeting as invitees as some regulatory approvals have to come from Germany and US regulators. Once those approvals come, they will be inducted as full board members,” he said.
Added Parekh: “Transition is going to take some time as restatement of accounts is going on. The Company Law Board has directed all of us to continue till further notice.”
“It’s a happy day for Satyam,” Karnik said, while thanking Satyam leaders and staff for the role played in these difficult times.
The board has submitted a list of 100 key Satyam employees to Tech Mahindra, Karnik said, adding that no decision had been taken yet on the continuation of Ram Manyampati, who was the interim chief executive after former chairman B. Ramalinga Raju stepped down.