The Andhra Pradesh government on Wednesday promised to render all possible assistance to the Central Bureau of Investigation (CBI) in probing the massive fraud in Satyam Computer Services after the High Court expressed its displeasure over the lack of cooperation with the investigating team.
On a direction from the court, the government filed a report within two and half hours, detailing the steps it would take to extend cooperation with the multi-disciplinary team of the CBI.
After being rapped by the judge for not cooperating with the CBI team, the government informed the court that it would provide the state-owned Dilkusha Guest House on Raj Bhavan road to the investigating officials.
It also promised to provide all necessary cooperation to the agency to complete the probe.
Earlier, in an extraordinary move the CBI approached the High Court, complaining that the government was not extending cooperation in the investigations.
Taking a serious note of the government’s attitude, Justice N.V. Ramana directed the state government to file its reply within two and half hours.
The CBI plea and the court’s displeasure have come as major embarrassment to the Congress government, which was already under fire from the opposition for being soft towards the disgraced founder and former chairman of Satyam B. Ramalinga Raju and other accused.
The government came under criticism for the delay in recommending to the central government to order a CBI probe. Opposition parties alleged that the probe by the Crime Investigation Department (CID) of the state police was aimed at shielding the accused.
The CBI last week took over the investigations into the Rs.70 billion accounting fraud, the biggest in India’s corporate history.
The premier investigating agency formed a multi-disciplinary team to probe the fraud, which Ramalinga Raju admitted to Jan 7.
It is heard from sources that the Satyam board has finally arrived at a decision on the sale process. The board may not need to meet again to discuss sale process. Lawyers are working on regulatory issues and proposal may soon be sent to the Sebi and the CLB. Details of the Satyam sale process will be made public over the next few days.
Industrialist B K Modi, whose Modi group is interested in acquiring Satyam Computer, said on Saturday that the stock market valuation could not be the basis for putting a reserve price for the sale of troubled IT firm.
Asserting that only action could determine the sale price for Satyam, Modi said that stock market price could not be considered a benchmark in this case, as the market was not fully aware about the firm’s actual assets and liabilities.
“The auction will determine the price… Why you require a reserve price … reserve price will only create controversy,” Modi told a news channel.
Besides Modi group, domestic engineering major L&T and Hinduja group are also interested in acquiring Satyam. A board member of L&T, which has already purchased about 12 per cent stake in Satyam from open market, yesterday said that the company was waiting for Satyam board’s decision on pricing mechanism to consider its next step.
Earlier this month, the Company Law Board allowed Satyam’s government-appointed board to go-ahead with a public auction plan to bring in new owners for the company. “What is the indicative figure…books are not there. It cannot be the market, because market is not even aware what are the assets and liabilities of the company,” Modi said.
The six-member Satyam Computer Services board is on a war-footing to find a strategic investor to buy out the fraud hit Indian software outsourcer, said Prem Chand Gupta, Corporate Affairs Minister, on the sidelines of a press conference on Sunday.
“The board will carry out the bidding process in the most transparent manner and any company bid for Satyam subject to the proceedings being laid down by the board,” the minister said.
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