From correspondents in Andhra Pradesh, India, 03:30 PM IST
Directors of the beleaguered IT major Satyam Computers Wednesday expressed shock the admission of founder-chairman B. Ramalinga Raju to committing a fraud to the tune of Rs.40 billion (Rs.4,000 crore or $823 million) before he resigned, along with Managing Director Rama Raju.
The Hyderabad-based Satyam said in a statement that the contents of Ramalinga Raju's resignation letter had shocked the members of the board of directors, senior management and thousands of its employees.
'We are obviously shocked by the contents of the letter. The senior leaders of Satyam stand united in their commitment to customers, associates, suppliers and all shareholders. We have gathered together at Hyderabad to strategise the way forward in (the) light of this startling revelation,' Satyam's interim CEO and whole-time director Ram Mynampati said in the statement.
Asserting that the immediate priority was to protect the interests of its shareholders and careers of its 53,000 employees, Mynampati said the company would strive to meet all its commitments to customers and suppliers.
The board has mandated the interim CEO to steer the company through the snowballing crisis.
'We recognise that our associates have committed a significant part of their careers to build Satyam. We will pursue all avenues to secure their future in the company,' Mynampati said.
The Satyam management believes its underlying business model, customer assets and growth prospects remain sound, even in the current challenging financial environment.
'The leadership expressed confidence that the company will be able to overcome this latest development and continue to provide excellent service to clients, while delivering value to shareholders in the medium to long term,' the statement added.
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A quick-footed reorganization of Satyam can help the company keep going on sound lines avoiding the pitfalls caused by improper risk-takig methods of top management.If this reorgn. is done in the least possible time, co's existing goodwill can be sustained to be further increased. in this, the company and the shareholders and the work force should work together with a profound sense of commitment and long range view, peacefully without allowing financial jealousies to mess up the situation further.The bigger picture of India as a growing IT muscle demands that this is the best way to go about the future.
The capitalist ideology rests on the cornerstone of pleasing the shareholders to the maximum extent in a ruthless ratrace between competitors in the same business. In realizing this objective, exploitation of suppliers, customers and employees of the concerned company, and of any opportunities for takeovers, acquisitons and mergers of weaker counterparts. Judgments of errors can become legally frauds even if aimed to maneuver adjustments of actual balance sheet position with anticipated gains from takeovers and the like. In view of the huge professional manpower resources assiduously built up by the management over the years, and the interests of the employees, a sensible legal view could be taken that balances the legal fraud against a great future tapping the global market potential and goodwill built, under a new management with the full understanding and cooperation of its employees and shareholders and other interests.
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