Tech Mahindra cannot do a Maytas on Satyam | business | Hindustan Times
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Tech Mahindra cannot do a Maytas on Satyam

business Updated: Apr 22, 2009 19:52 IST
PTI
Tech Mahindra cannot do a Maytas on Satyam

Satyam's government-appointed board has made it clear that the company's new owner, Tech Mahindra, cannot undertake any unrelated business without shareholders' approval, probably to thwart off any repeat of Maytas fiasco.

It was a proposal to acquire Maytas Infrastructure and Maytas Properties - two Raju family promoted firms in business of real estate and infrastructure development - that led to the disclosure about Satyam becoming home to India's biggest ever corporate fraud.

Before abandoning the deal, Satyam's founder and then Chairman B Ramalinga Raju had justified the acquisition by saying that the company needs to diversify into non-IT businesses to thwart off hostile takeover attempts from the likes of global technology giant IBM.

While disclosing the financial irregularities over several past years, Raju had said that the acquisition of two Maytas firms would have allowed him to replace fictitious assets with real ones.

Now, when Satyam's government-appointed board has found a new owner in Anand Mahindra-led corporate house's technology arm Tech Mahindra, the deal reached between the two parties mandates that the new owner can not undertake any unrelated business without prior approval of shareholders.