Three Satyam directors resign, more may quit

Three Satyam directors resign, more may quit

Hyderabad: Three more directors on Monday resigned from the board of Satyam Computer Services, taking the number to four, following differences over an abortive acquisition deal involving two firms promoted by Chairman Ramaling Raju’s family.

The NYSE-listed company on Monday announced the resignation of Mendu Rammohan Rao, who chaired the controversial 16 December board meetings where Maytas acquisition was announced.

Krishna G Palepu, Non-exective Director, and Vinod K Dham, Non-executive and Independent Director from the Board also resigned with effect from Sunday.

On 25 December, the board’s longest serving member Mangalam Srinivasan had resigned from the Board taking moral responsiblity for the fiasco over the Maytas acqusitions that raised questions about the role of independent directors and corporate governance issues.

Satyam, which deferred its board meeting scheduled for today, 29 December to 10 January, 2009, had earlier said it is looking at various options to increase shareholders value which also include reconstitution of the board.

B Ramalinga Raju, company Chairman, said “Amongst other items that are being taken up for consideration in the board meeting scheduled on 10 January, 2009, reconstitution of Board will be an important item."

However, the company said on Monday that Satyam promoters have pledged all their shares to institutional investors, who may have sold a part of it to recover dues.

Satyam shares traded at Rs146.25, up 9.41% on BSE.

Earlier this month, Satyam announced the acquisition of two companies promoted by the family of Raju, but had to call off the deal within hours follwing investors’ dissent.

The ADR of Satyam took a 55% hammering after the company announced the deal on 16 December.