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Satyam MD Rama Raju quits, admitting huge fraud
Wednesday, 14 January 2009, 02:19 IST |
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Bangalore: Satyam Computer Services founder chairman B Ramalinga Raju and Managing Director B Rama Raju resigned from the board Wednesday, the company announced. Shares of Satyam Computer crashed by over 72 percent to 
50 from a opening of 179.10 on the bourses around 1 p.m., following the resignation after he admitted to a 40 billion (4,000 crore or $823 million) fraud - the largest in corporate India.
"I sincerely apologise to all Satyamites and stakeholders, who have made Satyam a special organisation, for the current situation. I am now prepared to subject myself to the laws of the land and face consequences thereof," B. Ramalinga Raju said in a notice sent to the stock exchanges.He said that the software services firm had fraudulently incorporated a non-existent cash component and inflated the bank balance to reflect 5,040 crore (50.4 billion or $1.04 billion) as against 5,361 crore (53.61 billion or $1.1 billion).
The Hyderabad-based IT firm said Ramalinga Raju and Rama Raju have tendered the resignations earlier in the day and the regulator (SEBI) has been informed. Satyam also informed the stock exchanges that the company had terminated the services of global financial advisory firm DSP Merrill Lynch, which was engaged to advise the board at the reconvened meeting Jan 10.
As per the notification, Rama Raju shall continue in the position till the time the board is expanded and the continuance is to ensure enhancement of the board.
Global technology research firm Forrester Research sounded its clients Dec 31 that the beleaguered company was heading for a major shakeout or a possible takeover as a consequence of its management's bid to diversify from core IT business into realty sector by dipping into cash reserves of $1.2 billion (53 billion/5,300 crore).
Source: IANS
50 from a opening of 179.10 on the bourses around 1 p.m., following the resignation after he admitted to a 40 billion (4,000 crore or $823 million) fraud - the largest in corporate India.
"I sincerely apologise to all Satyamites and stakeholders, who have made Satyam a special organisation, for the current situation. I am now prepared to subject myself to the laws of the land and face consequences thereof," B. Ramalinga Raju said in a notice sent to the stock exchanges.He said that the software services firm had fraudulently incorporated a non-existent cash component and inflated the bank balance to reflect 5,040 crore (50.4 billion or $1.04 billion) as against 5,361 crore (53.61 billion or $1.1 billion).
The Hyderabad-based IT firm said Ramalinga Raju and Rama Raju have tendered the resignations earlier in the day and the regulator (SEBI) has been informed. Satyam also informed the stock exchanges that the company had terminated the services of global financial advisory firm DSP Merrill Lynch, which was engaged to advise the board at the reconvened meeting Jan 10.
As per the notification, Rama Raju shall continue in the position till the time the board is expanded and the continuance is to ensure enhancement of the board.
Global technology research firm Forrester Research sounded its clients Dec 31 that the beleaguered company was heading for a major shakeout or a possible takeover as a consequence of its management's bid to diversify from core IT business into realty sector by dipping into cash reserves of $1.2 billion (53 billion/5,300 crore).
Source: IANS