Satyam Names CEO and Special Advisors, and Secures Financing
- Longtime Satyam executive A.S. Murthy to lead organization, effective immediately
- Special advisors Homi Khusrokhan and Partho Datta appointed to strengthen management and financial operations
HYDERABAD, India, Feb. 05, 2009: Satyam Computer Services Limited (NYSE: SAY), a global consulting and information technology services provider, today appointed A.S. Murthy as chief executive officer. Murthy, a 15-year veteran of the organization, begins immediately.
“Extensive board discussions over the past few weeks made it clear that the new CEO should come from within,” said Satyam Board Member Deepak Parekh. “ASM, an extraordinary executive with widespread support among all stakeholders—internal and external—will do an exceptional job leading Satyam at this critical juncture.
“ASM has a deep understanding of the organization and proven management expertise; he has led a business unit, overseen global delivery, nurtured customer relationships and spearheaded the entire human resources function. Moreover, he is extremely well respected for his ability to integrate teams and foster collective decision making—critical skills as Satyam continues to revive.”
The board also appointed Homi Khusrokhan, the former Managing Director of Tata Chemicals, and Partho Datta, the former Finance Director of the Murugappa Group, as special advisors. These experienced executives will lend their expertise to Satyam’s Management and Finance areas, respectively. The special advisors, along with Boston Consulting Group, will work pro bono and help Murty and the board define and executive key strategies.
The critical appointments have further stabilized Satyam, which is recovering from an accounting crisis that came to light a month ago. In that time, the organization has worked hard to increase its focus on business continuity and restore associate and vendor confidence.
“This is a unique opportunity to provide direction and guidance and I accept it with all humility. I have no misgivings about the enormity of the task in front of us, but I am confident Satyam can accomplish great things—now, and well into the future,” Murthy said. “I look forward to working very closely with the board, our advisors and all Satyamites, to restore Satyam to its well-deserved glory. Our immediate priority is to chart precise and practical 30-, 60- and 90-day plans that encompass and address the interests of all stakeholders.”
In another significant development, the board confirmed that it has secured approximately $130 million in financing, which will be directed toward working capital requirements. The loan, along with healthy collections, will help the company manage several short-term financial challenges. Satyam also reaffirmed that January salaries (globally) and mid-February salaries (US-based associates) have been met from internal accruals. (US-based associates are paid every two weeks.).
In the next few weeks, Datta will focus on completing the complex financial restatement exercise, including announcement of third quarter results, and ensuring prudent financial operations. Khusrokhan will lend his expertise to the board, the priorities of which remain:
- Reaching out to customers and associates to reinforce their trust and confidence
- Asserting the financial position and restating Q3 results
- Evaluating long-term strategic options
- Assessing and managing legal liabilities
- Undertaking cost rationalization measures
- Resuming investments in identified areas
From a legal perspective, Wachtell, Lipton, Rosen & Katz (www.wlrk.com) will defend Satyam against class action suits in the U.S. Additionally, Latham & Watkins, a firm that has worked with Satyam for more than eight years, will continue its dialogue with the US Securities and Exchange Commission on the organization’s behalf.
The two-day meeting—the board’s fifth in less than a month—was chaired by Board Member C. Achuthan, the former presiding officer of the Securities Appellate Tribunal.
“I am confident we are on the right track and can continue to safeguard interests of our customers, associates, investors and other stakeholders,” he said.
Satyam’s new chief executive officer was promoted from Head of Satyam’s Leadership Development Group. In that role, A.S. Murthy (known as ASM) developed strategies and programs to enhance associate delight. The Real Time Leadership Centre, the Satyam School of Leadership, the Satyam Learning Centre and Business Facilitation Group were under his purview. Additionally, he was responsible for Satyam’s Global Delivery and information security; oversaw Human Resources; and is a member of the Apex Committee.
The 15-year Satyam veteran joined as head of delivery and led the company’s largest business unit before assuming responsibility for associate-related programs a decade ago. Before Satyam, ASM worked with Tata Consultancy Services (TCS) for 12 years.
Among his many accomplishments at Satyam, ASM led efforts to more closely align the company’s HR organization with its business goals. Before becoming CEO, he was transforming Satyam’s approach to leadership development and talent management.
ASM has a Masters Degree in computer science from the Indian Institute of Science in Bangalore and a Bachelors Degree in electrical engineering from the Regional Engineering College in Warangal, India.
Partho S. Datta
Partho S. Datta is a chartered accountant with 33 years of corporate experience. The former Group Finance Director of the Murugappa Group of Chennai joins Satyam as a non-executive special advisor, a position he has held with several companies.
He began his career with Dunlop India Limited. Later he joined Indian Aluminium Company Limited. He worked in various functions at that organization, including in the parent company of Indal in Canada, before becoming director and chief financial officer of Indal. During his tenure at Indal, the company received several awards for business performance and presentation of accounts.
In 1998, Datta joined the Murugappa Group. The Group won the prestigious World Family Business award during his tenure and also saw significant advances in corporate governance and professionalization. He has been involved with industry associations at both national and regional levels.
Homi R. Khusrokhan
Homi R. Khusrokhan retired as managing director of Tata Chemicals in December. Earlier, he was managing director of Tata Tea. Before joining the Tata Group in 2001, Khusrokhan worked for Glaxo Laboratories in India for 29 years, and was managing director of both Glaxo and Wellcome in the Subcontinent. He has been president of the Organization of Pharmaceutical Producers of India and vice president of the Bombay Chamber of Commerce and Industry.
A 1963 graduate (in commerce) from the Sydenham College of Commerce and Economics in 1963, he qualified as a Chartered Accountant in India in 1966 and did his post-grad studies at the London School of Economics & Political Science. He remains on the boards of several Tata Companies in a non-executive capacity.
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This press release contains forward-looking statements within the meaning of section 27A of Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Satyam undertakes no duty to update any forward-looking statements. For a discussion of the risks associated with our business, please see the discussions under the heading “Risk Factors” in our report on Form 6-K concerning the quarter ended September 30, 2008, furnished to the Securities and Exchange Commission on 07 November, 2008, and the other reports filed with the Securities and Exchange Commission from time to time. These filings are available at http://www.sec.gov
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