When we last reported on the $1 billion fraud scandal at Satyam Computer Services in India, brothers Ramaling and Rama Raju, former chairman and former managing director and CEO, respectively, had been arrested and the full board of directors had been let go.
Today, that new board of directors announced the appointment of Goldman Sachs and Avendus as investment bankers that will help the board explore strategic options, including "identification of strategic investors; obtaining expressions of interest; and ensuring a fair and transparent approach to the process." The board also appointed Boston Consulting Group (BCG) as management advisors.
The company noted that its board has:
- discussed the company's financing needs and will soon conclude negotiations with banks
- reaffirmed that January salaries will be paid as scheduled.
- validated the company's headcount.
- discussed a future management structure and plans to release more details this week.
In a statement, board member T.N. Manoharan, said:
The board has received several proposals from corporate entities and from private equity firms. Some are interested in evaluating Satyam as an integrated entity, while others have expressed interest in portions of Satyam's business. However, selling 'parts' of Satyam would be contrary to the Indian government's mandate regulating the company's affairs as a going concern. Therefore, we are not currently considering that option.
In other developments:
- Bloomberg reports that Thomas Mathew, the "assurance leader" for for PricewaterhouseCooper’s Indian affiliate, will resign from his current position but will remain a partner. Mathew was not involved in Satyam's audit but "in light of the present situation he believes it would be appropriate for him to relinquish his management position,” the company said. Two PWC partners, S. Gopalakrishnan and Srinivas Talluri, were detained by Indian police on Jan. 24 and have also been suspended.
- India's largest engineering firm, Larsen & Toubro Ltd., said it may increase its stake in Satyam to 15 percent because it expects the value to increase, according to a Bloomberg report.
- The company has turned to YouTube as a forum for new board members to share their thoughts on the company's future. A company spokesman told PC World that the videos are in place to ensure that the board's point of view is accessible to those who want to research the company.