New Satyam CEO is old Raju crony

The unseen hand of B Ramalinga Raju, the jailed promoter of Satyam Computer Services, continues to control the company even though the government has appointed its own board.

On Thursday, the government appointed AS Murty - a trusted lieutenant of Raju - as the new CEO of the company. This was after another trusted aide, Ram Mynampati, was briefly handed over the keys by Raju, who confessed to fraud on January 7.

“ASM (as Murty is known to Satyamites) is a true Raju acolyte. He should be called AS Raju, not AS Murty,” said a former Satyam employee.

“He first thinks of how Raju would react to a particular decision and then takes it. This is how ASM has worked for 15 years. The new company board has a duty to explain why he was finalised as the new CEO,” another former Satyamite said.

The shadow of the state government led by YS Rajasekhara Reddy, which showered huge contracts on Raju family-controlled companies, has also loomed large  after Raju’s confession, with the Andhra CID shielding Raju from a probe by the Securities and Exchange Board of India and the Serious Fraud Investigation Office. It took Sebi nearly a month to get Supreme Court permission to grill Raju in jail.

In fact, it is interesting to look at the way the Centre has moved in the Satyam case. It decided to supersede the company’s board a month ago to keep Raju’s clan from tampering with company records.

But after a month-long deliberation, the new board has almost given in to the wishes of Raju by bringing a crony of his to run the company.

Deepak Parekh, chairman of HDFC and Satyam director, justified the selection thus: “We are convinced that Satyam needs an internal leader to steer it at this critical juncture and ASM (Murty) has the required bandwidth and support”.  Board member Kiran Karnik added: “He (Murty) is the best person. He has an advantage, because he knows the customers and the employees.

Union corporate affairs minister Prem Chand Gupta, who was managing the CEO selection from behind the scenes, said: “He is a capable person. He has work experience of 17 years and he knows what is required, being an insider. I do not know why there is opposition from quarters.”

We’ll chart a practical plan: Murty

The government on Thursday appointed AS Murty — a trusted lieutenant of Raju — as the new CEO of Satyam Computer Services.

The board had earlier claimed that it had received about 40 applications from various interested candidates to be in the hot seat.

Murty, an electrical engineer, was Satyam’s chief delivery officer before being named CEO. In a statement on Thursday, Murty said he had no misgivings on the enormity of the task ahead. “But together with my colleagues, I am confident we can accomplish the impossible. We will chart a precise and practical 30-, 60-, and 90-day plan” to address investors’ concerns, he said.

Murty joined Satyam in 1994, when the IT major had just about 100 employees. He was heading the human resources department and helped the company increase its headcount. Rajus are alleged to have doctored the employee numbers to siphon off money from the company.

“He knows everyone in the company and every single client by name. In a way, he was the eyes and ears of Raju in the initial days of Satyam,” a senior Satyamite said.
Murty was also part of the leadership council that took the responsibility of keeping Satyam going after Raju resigned from the company.

Meanwhile, former Tata Chemicals managing director Homi Khusrokhan and former finance head of the Chennai-based Murugappa Group, Partho Datta, have been appointed as special advisors to the Satyam board. The duo will also assist Murty in conducting the business.

The company said on Thursday that banks had sanctioned Rs 600 crore of fresh funds. This, along with healthy dues collections, was expected to help tide over the company’s financial challenges.