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Satyam confident of paying salaries to associates

Allaying the fears of the over 50,000 employees, Satyam on Saturday said they are confident of paying the salaries for the month of January.

business Updated: Jan 10, 2009 16:38 IST

Allaying the fears of the over 50,000 employees, Satyam on Saturday said they are confident of paying the salaries for the month of January.

"We have certain challenges but I am sure the company will overcome them ... We are confident that that we will be able to pay the salaries to our associates," Satyam Computer Head Global Marketing and Communications Hari Thalapalli told PTI.

He further said that there would be no lay offs and salary cuts.

"Some of the clients with whom we had talked since Friday had said that they are happy with the government's initiative," he said.

Reacting to the arrest of Chairman Ramalinga Raju, he said, there is a huge amount of disbelief among the employees. "Raju was an idol to them," he added.

Thalapalli said the CFO and the Company Secretary are currently talking to the regulators but till now no one from the company has been summoned by the police.

Besides Satyam, Ramalinga Raju and brother Rama Raju, the government in its petition has also named the company's CA and auditor Price Waterhouse, Company Secretary as well as all the directors.

This include also those independent directors who have resigned -- Vinod Dham, Rammohan Rao, K G Palepu and Mangalam Srinivasan, as well as former Cabinet Secretary T R Prasad, V S Raju and interim CEO Ram Mynampati.

The CLB has also asked all the respondents to submit their replies to the petition by February 20. The CLB had ordered the Central Government to immediately constitute a fresh board of the company with not more than ten "persons of eminence as directors."

"The Central Government may also designate one of them as the Chairman of the Board... The said Board will continue till further orders."

The government said in its petition that Satyam has about three lakh shareholders, over 53,000 employees and has clients in over 60 countries, besides India. It has received a number of awards for best corporate governance. "But the reputation and credibility of the company suffered drastically in the recent past when the Board of Directors of the company approved a proposal to acquire stakes in two companies... Its share price crashed and four of the independent directors who were parties to the above proposal tendered their resignation from the Board," the petitioner said.

The impact of the manipulation of accounts, as disclosed by Raju on January 7, runs into hundreds of crores of rupees. The reputation of the company is at the lowest ebb and continuation of such a state would affect the confidence in the concept of corporate governance practiced in India.