正文
http://money.cnn.com/news/newsfeeds/articles/djhighlights/200901081214DOWJONESDJONLINE000770.htm
NEW YORK (Dow Jones) -- Top executives at Satyam Computer Services Ltd. vowed Thursday to restore confidence among investors and customers, as two class- action lawsuits were filed against the Indian software giant after its founder admitted to inflating its balance sheet by more than $1 billion.
Ten of the most senior executives at Satyam (SAY), including interim Chief Executive Officer Ram Mynampati, and about 40 other top managers have committed to remain with the company.
Satyam is facing a major crisis in which the unity and clear strategic direction of its top leadership are of paramount importance, top Satyam executives said in a statement Thursday. This collective commitment will serve to significantly assuage concerns of various stakeholders in a highly fluid and challenging situation.
Shares of Satyam crashed Wednesday in Mumbai trading after its founder and chairman, B. Ramalinga Raju, said the company had inflated its cash and bank balances on the balance sheet by more than $1 billion over the past several years.
Satyam\'s American depositary receipts plunged 90% in pre-market trading Wednesday on the New York Stock Exchange, which subsequently halted trading in the shares until further notice.
Class-action lawsuits filed
After the scandal broke, two law firms announced class-action lawsuits against Satyam.
Law firm Sarraf Gentile LLP said Thursday that it has filed a securities-fraud class-action lawsuit against Satyam on behalf of investors who purchased the company\'s ADRs between January 2004 and January 2009. The lawsuit is pending in Manhattan federal court.
Separately, law firm Izard Nobel LLP said late Wednesday that a class-action lawsuit against Satyam has been filed in U.S. District Court for the Southern District of New York on behalf of investors who bought Satyam\'s ADRs.
The complaint charges that Satyam and some of its executives violated federal securities laws by issuing materially false and misleading statements, Izard Nobel LLP said in a statement.
At Satyam\'s headquarters in Hyderabad, India, top executives announced Thursday an action plan to ensure business continuity and leadership transition.
The company said it has started a process to determine its financial liquidity position and verify the allegations made by its chairman. Satyam is also considering an independent audit.
Satyam has also started to reach out to its customers around the world in an attempt to assure them that it will meet all its business commitments.
While we have to address various customer concerns, we have been heartened by expressions of confidence and support from various clients, Mynampati said in a statement.
The company\'s top 100 customers account for 85% of total revenue.
Satyam has also formulated a task force to address all ongoing operational issues to ensure business continuity, including maintaining customer confidence. It is also seeking nominations from regulators and industry association for candidates to be new members of Satyam\'s board.
Meanwhile, a UBS analyst said the Satyam controversy could benefit other major players in the IT services arena, including such companies as Accenture, (ACN), Cognizant (CTSH) and Capgemini.
Analyst Govind Agarwal said in a research note that the corporate scandal could result in significant business disruption at Satyam and benefit tier-one IT-services vendors and other IT-services players with common clients with Satyam. The Satyam debacle also could present strategic hiring opportunities for its competitors.
NEW YORK (Dow Jones) -- Top executives at Satyam Computer Services Ltd. vowed Thursday to restore confidence among investors and customers, as two class- action lawsuits were filed against the Indian software giant after its founder admitted to inflating its balance sheet by more than $1 billion.
Ten of the most senior executives at Satyam (SAY), including interim Chief Executive Officer Ram Mynampati, and about 40 other top managers have committed to remain with the company.
Satyam is facing a major crisis in which the unity and clear strategic direction of its top leadership are of paramount importance, top Satyam executives said in a statement Thursday. This collective commitment will serve to significantly assuage concerns of various stakeholders in a highly fluid and challenging situation.
Shares of Satyam crashed Wednesday in Mumbai trading after its founder and chairman, B. Ramalinga Raju, said the company had inflated its cash and bank balances on the balance sheet by more than $1 billion over the past several years.
Satyam\'s American depositary receipts plunged 90% in pre-market trading Wednesday on the New York Stock Exchange, which subsequently halted trading in the shares until further notice.
Class-action lawsuits filed
After the scandal broke, two law firms announced class-action lawsuits against Satyam.
Law firm Sarraf Gentile LLP said Thursday that it has filed a securities-fraud class-action lawsuit against Satyam on behalf of investors who purchased the company\'s ADRs between January 2004 and January 2009. The lawsuit is pending in Manhattan federal court.
Separately, law firm Izard Nobel LLP said late Wednesday that a class-action lawsuit against Satyam has been filed in U.S. District Court for the Southern District of New York on behalf of investors who bought Satyam\'s ADRs.
The complaint charges that Satyam and some of its executives violated federal securities laws by issuing materially false and misleading statements, Izard Nobel LLP said in a statement.
At Satyam\'s headquarters in Hyderabad, India, top executives announced Thursday an action plan to ensure business continuity and leadership transition.
The company said it has started a process to determine its financial liquidity position and verify the allegations made by its chairman. Satyam is also considering an independent audit.
Satyam has also started to reach out to its customers around the world in an attempt to assure them that it will meet all its business commitments.
While we have to address various customer concerns, we have been heartened by expressions of confidence and support from various clients, Mynampati said in a statement.
The company\'s top 100 customers account for 85% of total revenue.
Satyam has also formulated a task force to address all ongoing operational issues to ensure business continuity, including maintaining customer confidence. It is also seeking nominations from regulators and industry association for candidates to be new members of Satyam\'s board.
Meanwhile, a UBS analyst said the Satyam controversy could benefit other major players in the IT services arena, including such companies as Accenture, (ACN), Cognizant (CTSH) and Capgemini.
Analyst Govind Agarwal said in a research note that the corporate scandal could result in significant business disruption at Satyam and benefit tier-one IT-services vendors and other IT-services players with common clients with Satyam. The Satyam debacle also could present strategic hiring opportunities for its competitors.
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