New CEO and CFO at beleaguered outsourcer Satyam
- 23 June, 2009 22:52
Troubled Indian outsourcer Satyam Computer Services announced the appointment of a new CEO and chief financial officer (CFO) on Tuesday. The two are former executives of Mahindra Group, the business group in the process of acquiring a majority stake in Satyam.
Satyam was plunged into a crisis in January after its founder B. Ramalinga Raju revealed that the company's revenue and profits had been over-stated for several years. The new government-appointed board decided to sell a majority stake in the company to a strategic investor, and Tech Mahindra, an outsourcing company of the Mahindra Group, was selected in a bid in April.
Tech Mahindra has four nominees on the board, while the government has six nominees including the chairman, Kiran Karnik. The government nominees to the Satyam board will continue in the near future, a spokesman for Satyam said on Tuesday.
Tech Mahindra's subsidiary Venturbay Consultants has so far acquired 31 percent of the equity of Satyam through a preferential issue of fresh equity. In line with the bid agreement, it made an open offer to Satyam's shareholders earlier this month to buy another 20 percent of the equity.
Satyam said on Sunday that it was adopting a new "Mahindra Satyam" brand, as it was now part of the Mahindra Group. The company name, however, was not changed.
C.P. Gurnani, the new CEO of Satyam, was previously Tech Mahindra's president for international operations. He replaces A.S. Murty as CEO. Murty, a Satyam executive, was appointed as CEO by the government-appointed board. He will continue as a senior member of the company's management, the spokesman said.
Satyam also appointed S. Durgashankar, a senior vice president at a Mahindra Group company, as the company's new CFO. The previous CFO Vadlamani Srinivas quit in the wake of the scandal.
Tech Mahindra also announced on Tuesday that Sanjay Kalra, its president for strategic initiatives, was promoted to CEO of the company. The current CEO Vineet Nayyar has been appointed as executive vice chairman of both Tech Mahindra and Satyam.