SATYAM

SCAM
"SINKING SHIP OR TIP OF
ICEBERG"

Presented by,
AMIT RAGHAV
SATYAM
COMPUTERS WHAT
IT IS ABOUT ?

1987: ESTIBLISHED BY B.RAMLINGAN RAJU

1991:LISTED IN BOMBAY STOCK
EXCHANGE
2006: SATYAM GAINS PROFITS MORE THAN
ONE ARAB DOLLAR.
4TH LARGEST IT OUTSOURCING COMPANY OF
INDIA
52585 EMPLOYEES ON 30TH SEP 2008.
HIGH GLOBAL REPUTATION
OFFER SERVICE TO MORE THAN 550 MNC.
B RAMALINGA RAJU
FOUNDER AND FORMER
CHAIRMAN OF ONE OF THE
BIGGEST IT GIANT OF OUR
NATION “SATYAM
COMPUTERS” AND
…………………………GUESS
WHAT THE PRIME CONVICT
IN THE BIGGEST SCAM OF
COUNTRY
 BRIEF INTRODUCTION OF B
RAMALINGA RAJU
Date of Birth: 16 Sep. 1954
Education: B-com (Andra loyala college, vijayvada)
M.B.A (Olio university, America)
President course (Harvard university)
Award: I.T man of the year in 2000
C.N.B.C asian business Leader corporate citizen of the year
award 2002
Business: Shri satyam mill in 1977
: Satyam construction
:Satyam computer 1987
Achievement of satyam computers
 1987: Established as corporate or private
Limited
 1991: Recognized as a Public Limited company
IPO oversubscribed by 17 Times
 1993 :Awarded ISO 9001 Certification
 1999: Satyam launch 1st Internet service (Sify
Broadband)
 2002 : Satyam BPO launched in Singapure
 2005: Largest global development center
outside India
 2006: Revenue exceeds US $ 1 billion
HOW DOES SUCH A SCAM MATTER?

 SATYAM SCAM INVOLVES AMOUNT

CLOSE TO 8000 CRORE
 SATYAM IS THE FOURTH LARGEST IT
FIRM IN INDIA CARRYING INDIA'S
OUTSOURCING IMAGE GLOBALY SO
IT'S ABOUT NATION'S IMAGE
 How it Happened?
23rd SEPTEMBER 2008 SATYAM GETS GOLDEN
PEACOCK AWARD.

o SATYAM COMPUTERS HAD ON DECEMBER 16, 2008

ANNOUNCED THAT IT WILL ACQUIRE TWO GROUP
FIRM – MAYTAS PROPERTIES AND MAYTAS
PROPERTIES AND MAYTAS INFRASTRUCTURE FOR
$ 1.6 BILLION (ABOUT RS. 8000 CRORE) AS PART OF
ITS DIVERSIFICATION STRATEGY, THIS CREATE A
ALLEGED VIOLATION OF CORPORATE
GOVERNANCE LAWS.
 17TH DEC MR. RAJU
WITHDRAWN HIS DECISION
AFTER THE PROTEST OF
INVESTORS.
 ON 23RD DEC. WORLD BANK H
DECIDED NOT TO WORK WITH
SATYAM COMPUTERS FOR THE
PERIOD OF 8 YEARS.
 On 7th Jan 2009 AN
ANNOUNCEMENT THAT
SHOCKED THE CORPORATE
INDIA THAT B.RAMALINGA
RESIGNED AND ACCEPT THE
FRAUD OF APPROX 7000
CRORE.
 GOVT. CEASES THE 30 BANK
ACCOUNTS.
Satyam Fraud
 THE COMPANY’S BALANCE SHEET WAS INFLATED TO Rs 5,361
CRORE AT THE END OF SEPTEMBER 2008 AGAINST THE
ACTUAL Rs 5,040 CRORE. THERE IS AN ARTIFICIAL CASH
BALANCE OF RS. 588 CRORE IN SEPT. 2008.
 Raju also admitted that Satyam's profits were inflated over several
years. And it is difficult for him to stop this fraud gap. He added,
"It was like riding a tiger, not knowing how to get off without
being eaten." The Maytas deal was the last attempt to fill the
fictitious assets with real ones.
 Raju also said Rs 1,230 crore was arranged to Satyam, which is
not reflected in its books, to keep Satyam's operations running. For
this, the promoter had to pledge the promoter shares and raising
funds from other sources.
 NOT ONE DAY FRAUD
It was not a one day fraud It is a strategic planning
because the inflated profit going an for year.
In 2008 Top management of satyam has sold out large
amount of share
Ram mynam pati 9.50 (Lakh Share)
Keshad panda 7.10(Lakh Share)
Pavan moddali 5.95(Lakh share)
Ravi Banmakanti 5.50(Lakh Share)
Virender Agrawal 5.00(Lakh Share)
WHEN FRAUD CAME INTO LIGHT
 7th Jan .2009 B Ramalinga Raju who the
founder of this company ,after resigning of B
Ramalinga Raju ,BSE fall down 749 point and
nifty fall down 192 Points.
 Share value of satyam fall down (NSE)
179.1 to 39.95 approx 77.69%
 55% share down in New York stock exchange
HOW DOES THE SCAM MATTER TO
THE NATION ?
 JOB’S OF OVER 50,000 TECHNOCRATS
WERE AT RISK
 COUNTRY’S BOOMING ECONOMY
FEARED SLIGHT COLLAPSE AS
COUNTRYS GDP FELL BY ESTIMATED
0.4%
 INDIA’S IT SECTOR SUFFERED
DOWNTURN AS IT’S IMAGE WAS
TARNISHED GLOBALLY
IMPACT ON STOCK MARKET

 The company’s share price had fallen 21.3

per cent since December 15, the day before
the crisis broke
 News of what is possibly the country's
biggest corporate fraud, sent the indices
tumbling. The benchmark Sensex slipped
over 7% on Wednesday, 7 January 09.
Companies perceived to have poor corporate
governance standards were most affected.
Jokes on Satyam Scam
Raju Raju sat on a wall
Raju Raju had a great fall
Balance sheet died
Shareholders cried
Raju Raju made a fraud
HOW GOVERNMENT KNOWS IT ?
 The ministry of corporate affairs later
ordered a probe into whether the company
violated any corporate governance laws
while entering into such a deal involving
share holders' money.
Charges Proved by CBI
 2315 Pages in Charge sheet.
 Total Fraud is approx 7136 Crore.
 Arresting of 9 Person (6 from Satyam
computers, 2 Auditors and 1 outsiders)
 Fudging the balance sheets and selling
company shares at times advantageous to
them.
 Filed cases under Sections 120 B, 420, 496,
467, 472 and 477A of the Indian Penal Code.
Satyam on Sale

On Feb 6th Tostabilize the sinking

Satyam Computers, the
Government nominated banker
KIRAN KARNIK
Deepak Parekh, IT expert Kiran FORMER PRESIDENT OF
Karnik and former SEBI member C NASSCOM
Achutan to the IT company's board.
On 6th March Satyam get the
permission from SEBI to sale 51%
share to sale.

.
Who wants to Purchase Satyam

 L&T
 Tech Mahindra
 Spice Group
 Hinduja
 Equity Firm wilber (An American Co.)
Finally Sold the Satyam

 The auction have decided between 9 to 13

April and lastly the date decided 13th April.
 Share purchase by Tech mahindra.
@58/share.
 Tech Mahindra raised Rs. 600 crore
ALL WELL THAT’S END WELL

 Anand Mahindra, Chairman, Tech

Mahindra, the new owner of Satyam.
 Address the first board meeting of the
company post the Rs 2,890-crore takeover,
giving hope and future to Satyam’s 45,000-
50,000 employees.
 A moment of truth for Satyam and a victory
for the government and the regulators.
Thank You