February 6th, 2009 
Aman Those who think about SATYAM be it being an employee, a shareholder, or for General knowledge purpose, on Thursday there was a news for them. A company insider, from human resources primarily, Mr. A. S. Murthy was appointed as new CEO of Satyam. Let’s hope the situation to change now. Also, Homi Khusrokhan, former MD of Tata Chemicals and Partho Datta, former CFO of Murugappa Group, who were tipped to be the CEO and CFO respectively, were simultaneously appointed as special advisors to the board to strengthen management and financial areas. This obviously means that they will not be members of the board.
Here I would like to emphasis that Murty is known to be extremely close to Ramalinga Raju. The only thing that differentiates him from the other Raju favorites in the company is that he is equally or I must say much liked by the Satyam staff who has welcomed this decision of his appointment. He is learnt to be consensus man.
Satyam board also announced that it had received Rs.600 crores as bank sanctions which was part of a planned fund infusion towards the working capital requirements. There was also a news that salaries for January (globally) and the fortnightly salaries for February for its US-based associates have been met from internal accruals.
The board discussed with senior executives of the company. There were three names who were preferred. Based on this discussion and other feedback sessions Murty’s name came up in most of the lists. It is interesting to learn that company affairs minister Mr. P.C.Gupta once said that the new CEO of the company should be an internal man. Murthy was chief delivery officer in the company.
The board once again confirmed the key priorities and focus of the company will remain unchanged. The company will reach out to the key customers and associates to reinforce their trust and confidence. The company is going to assert the financial position and restate the Q3 results. It will evaluate the long term strategic position and options, legal liabilities and would deal with them, undertake the cost rationalization measures, resume the investment in the areas identified.
New York-based legal firm Wachtell, Lipton, Rosen & Katzin is also appointed to address various class action suits — numbering about a dozen – filed against it in the US. It was, however, made clear that Latham & Watkins, lawyers of Satyam for over eight years will continue to support it in its ongoing dialogue with the US Securities and Exchange Commission (SEC).
The appointment of Mr. Murthy will definitely take care of the son of the soil sentiment as witnessed in the recent weeks in the company. He is well respected in the company. His ability to integrate teams effectively and to make a collective decision is critical for Satyam as the company is going through its revival phase.
Though most of the external clients of the company were told that the new CEO would be an outsider and now that Murthy is appointed, it would be worth watching how company is going to explain this to the clients that the decision would ensure cleaning of Satyam. It is quite obvious though why the choice fell on an internal candidate. No external candidate would like to join a company that possibly would get sold off in next few months, so no one is expected to take a plunge if not sure about his future.
Posted in 
