The Government of India has kicked out Satyam’s board and plans to nominate 10 members, according to media reports coming from India.
Satyam’s board meeting scheduled for Saturday has also been cancelled.
Here’s the text of the statement issued by India’s Minister for Corporate affairs Prem Chand Gupta on disbanding Satyam’s board:
You have been witnessing the developments in Satyam case for last few days.
To be brief and precise, let me share with you that the Government is deeply concerned and determined to take all possible action under the law to bring to book at the earliest all those persons who are responsible to betray the faith of lakhs of shareholders, thousands of employees, esteemed customers within and outside the country and various other stakeholders.
The greed and misdeeds of a few persons who were at the helm of affairs of the company could have caused the present unfortunate situation. We are determined to reach the truth but are equally concerned with the fate of employees and other stakeholders.
You are already aware of the prompt, effective and co- ordinated regulatory action being taken by the ministry. Officers of this ministry along with officers of SEBI at Hyderabad have already taken various actions. These include siezure of documents of the company after obtaining orders from judicial magistrate at Hyderabad, a team of officers of the Ministry of Corporate Affairs have already started inspection of eight group companies and co-ordination with the authorities of the State government of Andhra Pradesh.
Action against auditors of the company has already been initiated by the ICAI, the developments so far indicate that the current board of Satyam has failed to do what they were supposed to do.
As I have already said before, Satyam case is an aberration. The credibility of Indian corporate sector in general and IT sector in particular should not be allowed to suffer because of this. It is the prime concern of the government to ensure that the operations of the company continue uninterrupted and in that view, the government decided to approach the company law board who on the petition of the government has allowed the following interim prayers-:
1) To restrain the current directors of Satyam from acting as its directors.
2) To allow the Central government to appoint ten nominee directors to function as directors of the company.
Following the above, the government is considering appointment of suitable persons as directors of Satyam. We will let you know about the person being nominated on the board as soon as decision is taken in this regard.
The question is why did it take the government nearly 60 hours to kick out the incompetent board.
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