The Insider...Satyam names A.S. Murty as new CEO

Satyam Computer Services Ltd. announced that the Board of Directors has appointed A.S. Murty as the new Chief Executive Officer, effective immediately. Murty is a Satyam veteran of 15 years, who has been in its forefront since Jan 1994. The Board also appointed Homi Khusrokhan and Partho Datta as Special Advisors, to assist in Management and Finance areas, respectively. These decisions are aimed at quickly stabilizing the company, Satyam said in a statement. The organization has visibly increased its focus on business continuity for its customers and confidence building amongst its employees and vendors, it added.

Murty joined the company in 1994 and has worked across several businesses and functions. His immediate task is to address the concerns of its clients and retain employees. He said he will be working very closely with the Board, Advisors and all Satyamites, to restore the company to its well-deserved glory. "We will chart a precise and practical 30 - 60 - 90 day plan that will encompass and address the interests of all stakeholders," Murty said.

The board also confirmed receiving bank sanctions for a total sum of Rs6bn (US$130mn approximately) as a planned fund infusion towards working capital requirements. This funding, along with healthy collections, is expected to help the company tide over its financial challenges. Satyam also reaffirmed that January salaries (globally) and the fortnightly salary in February (for US based associates) have been met from its internal accruals. "Completing the complex financial restatement exercise including announcement of Q3 results and ensuring prudent financial operations will be the primary focus in the next few weeks," Datta said.

Separately, Kiran Karnik, the former president of India’s software industry body NASSCOM, was named chairman of Satyam, Company Affairs Minister Prem Chand Gupta said. He also said that the Government was probing 325 companies and 25 persons linked to the Satyam scam.

Meanwhile, iGate Global Solutions, one of the potential suitors for Satyam, has dropped out of the race to acquire the troubled software services company. iGate CEO Phaneesh Murthy said that his company was not interested in pursuing the deal in its current form where Satyam’s financial position is unclear and the government has not capped its liabilities.