Satyam appoints new CEO
Appointment of Satyam insider welcomed by markets, seen as indicator of desire to sell company by analysts
Troubled services company Satyam has appointed a new CEO, AS Murty, to revive the company’s fortunes.
Murty, who was previously head of Satyam’s Leadership Development Group and was also in charge of global delivery and information security, will take on the role immediately. Murty is a fifteen-year veteran of Satyam, and previously spent twelve years with Tata Group.
Markets reacted favourably to the news, with shares in Satyam rising by as much as 7% in trading in Mumbai. Satyam has been without a CEO for four weeks after the Indian government stepped in to appoint a board of directors for the company following the discovery of massive fraud by founder and chairman B Ramalinga Raju and family members.
Some analysts believe that the appointment is an indicator that the company is looking for a buyer, rather than charting a long term course, with Murty seen more as a management and technical expert than a c-level executive.
RK Gupta, managing director of New Delhi-based Taurus Asset Management told Reuters: “It’s clearly an interim arrangement before a buyer comes in and puts in place his own management team.”
Satyam Board Member Deepak Parekh said in a company statement: “ASM, an extraordinary executive with widespread support among all stakeholders—internal and external—will do an exceptional job leading Satyam at this critical juncture.
“ASM has a deep understanding of the organization and proven management expertise; he has led a business unit, overseen global delivery, nurtured customer relationships and spearheaded the entire human resources function. Moreover, he is extremely well respected for his ability to integrate teams and foster collective decision making—critical skills as Satyam continues to revive,” he added.
Satyam also announced that it has appointed two independent special advisors, Homi Khusrokhan, former managing director of Tata Chemicals, and Partho Datta, the former finance director of the Murugappa Group, to give guidance in management and finance respectively. Satyam has also appointed the Boston Consulting Group to give guidance on strategy.
The board also disclosed that it has secured around $130 million in financing, which will be directed toward working capital requirements.