Satyam a year on

It is the biggest fraud in India Inc’s history. Year 2009 saw the fall of Satyam and its resurrection as Mahindra Satyam. On January 7, Ramalinga Raju’s confession of a Rs 7000 crore fraud dealt a blow to India’s corporate image and the rest of the year has been full of drama.

Raju lands in jail and Satyam looks for a new owner. Satyam was exposed, employees scared and investors stunned.

In an unprecedented move the government took charge, superceding the Satyam board. Ramalinga Raju was sent to jail along with his brother Rama Raju amidst shouts and slogans.

Satyam was sinking—no money and clients were uncertain. That’s why the government-appointed board became the rescuers. Their task was cut out—rebuilding Satyam. But the Satyam nightmare came to an end in April 2009. Anand Mahindra was the white knight who gave Satyam his name. Rechristened as Mahindra Satyam, the company was saved and in safe hands.

In June 2009 the new management announced a virtual pool of 10,000 employees, in other words mass layoffs, an attempt to plug massive losses. However, a six months’ notice period did come as a cushion. Satyam became a 30,000 strong employee force, almost 20,000 less than its original count. But while sentiments were improving gradually, CBI chargesheet dealt a blow saying the fraud could be much deeper, almost double, to an extent of Rs 14000 crore. Mahindra Satyam hit back, settling a billion-dollar Upaid forgery case out of court for less than $70 million.

Now, as Mahindra Satyam logs into a new year 2010, it has much to prove, settling class action suits, restating its accounts and most importantly keeping its herd together on road to successful merger with its parent company Tech Mahindra.

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