mahindra satyam temp

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  • 8/8/2019 Mahindra Satyam Temp


    From Satyam to Mahindra


  • 8/8/2019 Mahindra Satyam Temp


    Satyam Computer Services Ltd

    Founded in June 1987 as a private limited company byRamalinga Raju along with R Rama Raju

    In June 1991, Satyam Computers got its first Fortune

    500 Client and was recognized as a Public LimitedCompany

    One of the leading global consulting and IT servicescompany that offered end-to-end IT solutions

    The company employed over 50,000 IT professionalsacross development centers in 6 continents

  • 8/8/2019 Mahindra Satyam Temp


    Satyam Clients

    A total of 650+ Clients

    185 of the top fortune 500


  • 8/8/2019 Mahindra Satyam Temp



  • 8/8/2019 Mahindra Satyam Temp


    The White Knight - techMahindra


    Incorporated in 1986 as a joint venture of Mahindra Group & BT

    IPO in 2006, rechristened to Tech Mahindra


    Comprehensive service offerings for TSPs, TEMs & ISVs

    Consulting, Application Development & Management, Network

    Services, Solution Integration, Product Engineering, Managed Services,

    Remote Infrastructure Management and BPO.

  • 8/8/2019 Mahindra Satyam Temp


    Leader in Telecom offshoring

    Ranks 5th among the Top 20 IT Software and Service exporters in India (excluding BPO revenues)

    Stands 11th in the IT-BPO Employers category.

    Global presence

    Operations in more than 25 countries

    Global presence with 16 sales offices & 13 delivery centers

    Customer profile

    Clients include 11 Fortune Global 500 companies (5 US)

    Customers include 12 of Top 20 wireless TSPs & Top 5 TEMs

    Major clients

    BT, Cisco, Alcatel Lucent, Microsoft, Motorola, O2, Qwest, StarHub,

    TNZ, Hutchison, Unisys, Vodafone, BSNL, Airtel, MTN, Etisalat, Zain, TMobile,

    NSN, Cox, Telus, Huawei.


    Around 33,000+ professionals across the globe.

    The White Knight - techMahindra

  • 8/8/2019 Mahindra Satyam Temp


    Strategic intent

    Engineer the groups entry into the big league

    of Indias IT sector joining the ranks of Tata

    Consultancy Services, Infosys and Wipro

    Diversification and derisking of business

    No overlap in businesses

  • 8/8/2019 Mahindra Satyam Temp


    The Big Confession

    Confession of fraudulent accounts

    Balance sheet (as on the 30th of September,

    2008) reflected: Inflated figures for cash and bank balances by

    361 crores

    Accrued interest of Rs 376 crore which was non-


    Understated liability and overstated debtors


  • 8/8/2019 Mahindra Satyam Temp



  • 8/8/2019 Mahindra Satyam Temp


    The Aftermaths

    Satyam stock price falls to 39.95 from 178.95

    The New York Stock Exchange halted trading inSatyam stock from January 7, 2009.

    Indias National Stock Exchange announcedthat it will remove Satyam from its Nifty 50-share index from January 12, 2009.

    More than 12 law suits filed in US court Auditing firm PriceWaterHouseCoopers came

    under scrutiny

  • 8/8/2019 Mahindra Satyam Temp


    Corporate Governance??

    September 2008 - Golden Peacock award for

    Excellence in Corporate Governance

  • 8/8/2019 Mahindra Satyam Temp


    Bidding process

    6th Mar, 09 Approval From SEBI .



    Mar, 09 Registration for Bidding.

    Criteria - min Rs. 1500 crores

    No minimum Floor price required.

    Lock-in period 3 yrs.

  • 8/8/2019 Mahindra Satyam Temp


    Bidding Process(cont.)

    Investor to get 31% fresh Equity shares from

    Satyam .

    Additional 20% from Public Offer.

    Open Offer Price = Bid Price.

  • 8/8/2019 Mahindra Satyam Temp


    Bidders involved

    L & T Infotech@ Rs.45.90 per share

    Wilbur L Ross & Co @ Rs. 20 per share

    Tech Mahindra @ Rs. 58.90 per share

    Cognizant & Spice Corp.

  • 8/8/2019 Mahindra Satyam Temp


    Tech Mahindra wins Satyam Bid.

    Paid Rs. 1756 crores for 31% stake .

    Additional 20% for Rs.1129 crores.

    FUNDING-- Raised Rs. 550 crores by issuing Convertible


    -- Borrowed Rs. 1450 crores @ 10% rate.

  • 8/8/2019 Mahindra Satyam Temp


    Post-acquisition scenario & valuations


    To rebuild the brand image

    Issues related to governance( litigation),

    Retaining customers,

    Reduce insecurity among employees,

    Downsizing .

  • 8/8/2019 Mahindra Satyam Temp


    Effect On Tech Mahindra

    Net borrowings of Rs 2,380 crores

    paid Rs 57.1 crores as interest for just over two months onits borrowings that have a tenure of one to five years.

    Revenues increased to Rs 1,113 crores by 5.8% from Rs

    1,051 crores in the last quarter of 2009 . Tech Mahindra reported a net profit of Rs 131.6 crores in

    the first quarter ending June 30, 2009 as against Rs 230.4crores , down by 42.8% in the last quarter.

    The drop in net profit was largely due to interest paid and

    forex loss of Rs 26.1 crores due to currency fluctuations.