11 Things Satyam Needs to Do to Survive

Since the decimation of Satyam Computers (SAY) is now complete, it is game over for SAY stockholders. Or is it? When it applies to asset preservation, the company has been quite slow to act. All of the former promoters/board members are gone, and for someone in the US who owns the ADR, there is zero recourse [not that Madoff investors did any better]. At the minimum, Maytas Infras and Maytas Properties must be integrated into SAY - so that the now beat up stockholders can get something for their billion that never was.

My proposal to save what is left of SAY:

1. Appoint a board of three or four - from the top three or four largest “non-family” stockholders of SAY. Let’s call them the asset preservation committee for SAY.
2. Strap all of the ex-SAY family with GPS tracking devices.
3. Immediately integrate Maytas Infras and Maytas Properties into Satyam.
4. Freeze all the bank/stock accounts of all ex-board members and spouses thereof.
5. Freeze the sale of all real assets belonging to ex-promoters/board members.
6. Freeze the traditional gold/silver assets of the ex-board members and spouses thereof - held in all banks that they have been seen in - in the last two decades.
7. Offer a 10% reward to all whistle-blowers who lead the asset preservation committee to any assets not confiscated by Feb 1, 2009.
8. Make sure that the rewards are announced in newspapers distributed in Hyderabad.
9. Make sure that the rewards are paid out.
10. On Feb 15th, tabulate what is left of SAY, and move forward.
11. Pare the Asset Preservation Committee to one member who will recover all future assets [seizures initiated by whistleblowers].

Did I miss anything? I doubt it. Something like this has never been done [even here in the US - where the reaction to the Madoff scandal has been nothing short of scandalous].

Disclosure: Of course NO positions in SAY.

Comments

[sunil94062:]

Your views and suggestions are mostly wrong.

The Politico Nexus is way too strong in India big-business.

Politicians are either directly invested or use their position to wring all manner of dole from corporates. This is endemic in India.

Irony (in some way) that even US Banks and PE players, that went to India, quickly subscribed to the India system, and these are names such as Goldman, Morgan Stanley, Merrill Lynch, UBS, Warburg Pincus, Blackstone, Och-Ziff all seek and receive Baksheesh when they make their less than judicious investments in India. In matter of fact unless the Indian dudes get paid a deal does not happen.

Their investment pain is clear to see. More investments have soured than profited. No exits and massive NAV write-off's.

Reliance - the big daddy of all corrupt machines, is the very nexus of crime interweaved with politicos. That is how they gt into Refining and into telecom - by having the politicians re-jigg the laws so they paid no license fees to start with, had rules bent, and paid out large bribes to get that done. Even today, they are a well oiled machine for Bribery. Amar Singh connection on the one side and Sonia Gandhi connectionon the opposite side.


Governance exists in India? - what governance - shoot, HDFC Bank - willingly participated in this Fraud at Satyam (they were one of the banks that did primary banking for Satyam and surely saw Satyam Financial Statemenmts regularly, and in all probability responded to the PwC confirmations with an affirmative answer, year after year - as that is but standard in Auditing practices, and was surely followed - having worked at PwC I can vouch for that standard - no way that cash-in-bank was not confirmed) and now we find the the GoI has the HDFC Chairman, Deepak Parekh is on the Satyam interim board! What?? Huh?. His fingers are tainted. How is he going to right this ship?

Then there is IL&FS - is the other bad guy - used insider information to trade in the very shares of Satyam - and it is known that they are largely a government run institution - they get most of the large infrastructire awards for that reason - the rest of their business is a friggin eye-wash.

And then there are other darlings of Dalal street, that need to implode as well:

DLF - Owned by the Singh family and we catapulted them into one of the richest men on the Planet (ah! - what a scam this is - majority of the Revenue is sales to affiliates, and the Balance Sheet is mightily goosed by inter-company stepped-up value sales. Values are routinely vetted by the likes of US outfits gone to India - CBRE/E&Y/KF/C&... to sign off on projected values that are way out of the realm of reasonableness). There is an huge political nexus there. There is this senior bureaucrat from ther GoI that just joined DLF (Rajeev Talwar), is one such player at DLF who has become the mouthpiece of DLF. You meet him re business, and the first thing he asks for is Baksheesh, if you wish to do business wit DLF. Says it is the law of the land.

And then there is Unitech (India's oldest Real Estate listed company), now starpped for cash after for example burning/stealing through about $800 Million of cash raised at the AIM in UK (Unitech Commercial Parks, plc), and then caught short as they were trying to third-flip same assets into a new SINGAPORE listed REIT and were suitably thrashed - and now they are flailing, scambling for debt and more debt. These buggers with the complicit behavior of all the major valuers pawned land that perhaps had a nominal value of INR 500/sf and sold it into the AIM lister at INR 5,000/sf! and now the stock is trading at the equivalent of 95% less! Bravo.

In short - not sure your 10 things listed will work.

Propose breaking the nexus of where the Money and Power come from in India - the Politico's. All are complicit - all Ministers and all Party Leaders.

Find me 10 honest politicians in India and Ten Business where their hand does not extend into a large Indian company.

Super hard.

There is a GOD and that is the only reason why India wakes up and foes to work each day.

Way too mch rip-off on all aspects of Indian business and Government.

Jan 14 12:23 PM

[CoxyRedWhit...:]

I Hope they lose all U.S. business for being so arrogant, Indians truly believe they are smarter than Americans. I know, I work with them daily. Arrogrant, arrogant, arrogant!

Jan 15 12:51 AM

[Peace Lover:]

I hate when people take any discussion for an opportunity to take a stab at people from other country (race/religion/so on...). I can surely right 10 pages on why you sound more arrogant and why 3 big auto companies have failed. Though I am sure these idiots are not going to listen so let me just say this - Let's start working to get out of this mess. Talking dirty at others is not going to do any good at all.


On Jan 15 12:51 AM CoxyRedWhiteBlue wrote:

> I Hope they lose all U.S. business for being so arrogant, Indians
> truly believe they are smarter than Americans. I know, I work with
> them daily. Arrogrant, arrogant, arrogant!

Jan 16 07:09 PM