The government on Sunday appointed a three-member board comprising Deepak Parekh, chairman HDFC, Kiran Karnik, former Nasscom president, and C. Achuthan former Sebi member to bail Satyam out of the current crisis.
Prem Chand Gupta, corporate affairs minister said, The board would provide the necessary vision, along with responsible and accountable leadership to the company, in this hour of crisis... This would be an independent board with full authority to act in the interest of the company, the shareholders and all other stakeholders. The board will, therefore, make its own assessment and take appropriate decisions.
There was no specific instruction to the board to find a buyer for Satyam. The board needs some time to bring the state of the affairs in the company back to normal, considering the extent of damage.
To a question, the minister also said the new board would run the company till further decision , before handing over control to a shareholder-decided leadership. The government is open to considering the requests of shareholders wanting a say in the running of the company. All options that are in the interest of the company are open to the government, Gupta said, without confirming or denying the possibility of foreign investor Lazard s induction into the board. The government would consider appointing more directors as and when the need arises..
Gupta has also left to the new board the timeframe for restating Satyam s financial statements. Everything about the future of the company would be decided by the newly-constituted board, keeping in mind the interest of the company, its employees, clients and other stake holders... The work of investigators will run parallelly, taking the board into confidence.
The government and various industry organisations have requested me to be on the board as it is a national need to revive Satyam. There are a hundred steps which need to be taken to get it right. However, the first is to restate the company s balance sheet and revive the confidence of investors, employees and other stakeholders, Parekh was quoted as stating by newspapers.
Karnik said, We don t know what the status on the ground is at Satyam. So, we will investigate what the company s position is with regard to cash, employees and legal cases. We have to let the investigations go on, ensure that the operations continue and the customers and employees confidence is restored.
Satyam said in a communiqu to the BSE, Satyam welcomes this key development, which will ensure the company's continued operations, help maintain customer confidence and associate morale, and restore investor trust. The new members are eminent and accomplished leaders, recognized in India and around the world for their expertise in finance, law, business administration and the IT services industry. Satyam's leadership team pledges to work closely and in full cooperation with them.
On the board meeting, the statement quoting a company statement said, "This is a vital stabilizing development for Satyam, and a key step in affirming the company's determination to turn a new chapter in its history, it is the best news we've received in the past few weeks."
