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7/23/2019 Group10 Mahindra-Satyam Interim
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Tech Mahindra Acquisition of SatyamComputer Services Ltd
Pre-Merger Scenario at Satyam Computers:
Mr. B Ramalinga Rau created Satyam Computer Services Ltd. as a private limited
company on !"th #une$ %&'( )hich *ecame pu*lic in %&&%. The company started
)ith o+ering S,- development and consultancy services to *usiness
organiations across di+erent industries.
/n !00'$ pro*lems cropped up in the company )hen the Chairman Mr Ramalinga
Rau informed that he )anted to deploy the cash availa*le for the *ene1t of
investors and announced 2%.3 *illion *id for t)o Maytas companies i.e. Maytas
/nfrastructure Limited and Maytas 4roperties Ltd. promoted and controlled *y the
same family. The investors did not approve the step and Mr. Rau *ecame furious
and run a)ay. -orld Ban5 announced on 6ecem*er !7$ !00' that Satyam has
*een *arred from any *usiness )ith -orld Ban5 for eight years for providing
Ban5 sta+ )ith 8improper *ene1ts9 and charged )ith data theft and cases of
*ri*ing the sta+. Share prices )ere falling drastically. Ramalinga Rau resigns. /n
!00&$ Satyams C;< Srinivas =adlamani confessed that *y in>ating the num*er
of employees *y %0$000$ the company )as earning around Rs !0 crore,month
from the related *ut 1ctitious salary accounts and *efooling the )orld.
Pre-Merger Scenario at Tech Mahindra
Tech Mahindra is a part of the Mahindra ?roup conglomerate and is
headquartered at Mum*ai$ /ndia. Tech Mahindra is ran5ed @th in /ndias soft)are
services 1rms.
/ts activities spread across a *road spectrum including Business Support
Systems$
7/23/2019 Group10 Mahindra-Satyam Interim
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company might face many pro*lems and can resist in accepting the ne) culture.
/t might lead to lac5 of motivation$ frustration$ lo)er productivity$ )hich can
a+ect a company to a great eJtent.