Satyam Rajus Looking for Strategic Partner?

By M H Ahssan

Faced with a virtual revolt from various stakeholders, including the very same independent directors who had cleared the controversial Maytas buyout proposal, the Rajus of Satyam Computers are actively considering inducting a strategic partner and selling out their shares in the $ 2-billion IT company.

Late on Saturday evening, the company while postponing its board meeting from December 29 to Jan 10, announced the appointment of DSP Merill Lynch to advise on "strategic options to enhance shareholder value." A company release also talked of a "possible dilution of promoters' stake in the company." Analysts said that these two points when read together could mean that the Rajus are looking at an exit route and bringing in other investors. "The promoters own only 8.6 per cent of the company's shares. That is very low. Dilution could mean that they go out," averred Monotosh Sinha, executive director of Centrum Capital.

Satyam will also recast its board of directors: some board members are expected to exit, while some new faces could come on board. The Satyam release suggested that the next board meeting will consider "measures to strengthen the company's goverance structure, including the size and altering the composition of the board." Facing flak from all quarters, ISB dean M Rammohan Rao, who chaired the controversial meeting that okayed the Maytas deal, is expected to leave the board. But father of Pentium, Vinod Dham, who told TOI that he had asked for a special board meeting to consider all matters pertaining to the company is expected to continue and play a pivotal role. "He is a well-known name in technology circles in the US. And the stockmarket there would react positively to his continuance on the board," an analyst pointed out. Dham, along with Harvard Business School professor Krishna Palepu, is expected to physically attend the board meeting: in the past, the two usually participated through video conferencing.

Sources expected that if the sell-out by Satyam does not happen or till such times that it happens, B Rama Raju, the co founder and brother of Ramalinga Raju and managing director of the company, will step down from his executive position and make way for a salaried professional as managing director. "He will continue as a non executive director," sources averred. Similarly, it is expected that Ramalinga Raju might himself become a non executive chairman of the Satyam board.

IBM likely to takeover Satyam?
Stories about the disinclination of the Rajus to continue with Satyam Computers have been doing the rounds for the last two years with the constant buzz being that IBM would possibly takeover the company. “Though constantly denied, the fact that these tales persisted only shows that there cannot be smoke without fire,” says a top Hyderabad businessman known to Ramalinga Raju for long.

Raju who started off his entrepreneurial career in the construction business has a fascination for the real estate and related industry, say people who know him. This is precisely the reason why Maytas (which is Satyam spelt in reverse) was spawned by Ramalinga Raju a few years ago. Maytas has now grown big and comprises Maytas Infra and Maytas Properties. The former’s order book is over Rs 12,000 crore besides the Hyderabad Metro Rail project.

Satyam Computers has reserves of Rs 8500 crore. “All indications are that they want to exit, but by selling out they will lose control of this money. That is why I cannot figure out why they want to sell out,” a chief financial officer of a top corporate told TOI. “Unless you see it as an instance of the promoters being potentially forced out of the company by the shareholders. But nothing similar has happened in India before,” said Amitabha Guha, former deputy managing director of SBI.

Satyam Rajus Looking for Strategic Partner?

By M H Ahssan

Faced with a virtual revolt from various stakeholders, including the very same independent directors who had cleared the controversial Maytas buyout proposal, the Rajus of Satyam Computers are actively considering inducting a strategic partner and selling out their shares in the $ 2-billion IT company.

Late on Saturday evening, the company while postponing its board meeting from December 29 to Jan 10, announced the appointment of DSP Merill Lynch to advise on "strategic options to enhance shareholder value." A company release also talked of a "possible dilution of promoters' stake in the company." Analysts said that these two points when read together could mean that the Rajus are looking at an exit route and bringing in other investors. "The promoters own only 8.6 per cent of the company's shares. That is very low. Dilution could mean that they go out," averred Monotosh Sinha, executive director of Centrum Capital.

Satyam will also recast its board of directors: some board members are expected to exit, while some new faces could come on board. The Satyam release suggested that the next board meeting will consider "measures to strengthen the company's goverance structure, including the size and altering the composition of the board." Facing flak from all quarters, ISB dean M Rammohan Rao, who chaired the controversial meeting that okayed the Maytas deal, is expected to leave the board. But father of Pentium, Vinod Dham, who told TOI that he had asked for a special board meeting to consider all matters pertaining to the company is expected to continue and play a pivotal role. "He is a well-known name in technology circles in the US. And the stockmarket there would react positively to his continuance on the board," an analyst pointed out. Dham, along with Harvard Business School professor Krishna Palepu, is expected to physically attend the board meeting: in the past, the two usually participated through video conferencing.

Sources expected that if the sell-out by Satyam does not happen or till such times that it happens, B Rama Raju, the co founder and brother of Ramalinga Raju and managing director of the company, will step down from his executive position and make way for a salaried professional as managing director. "He will continue as a non executive director," sources averred. Similarly, it is expected that Ramalinga Raju might himself become a non executive chairman of the Satyam board.

IBM likely to takeover Satyam?
Stories about the disinclination of the Rajus to continue with Satyam Computers have been doing the rounds for the last two years with the constant buzz being that IBM would possibly takeover the company. “Though constantly denied, the fact that these tales persisted only shows that there cannot be smoke without fire,” says a top Hyderabad businessman known to Ramalinga Raju for long.

Raju who started off his entrepreneurial career in the construction business has a fascination for the real estate and related industry, say people who know him. This is precisely the reason why Maytas (which is Satyam spelt in reverse) was spawned by Ramalinga Raju a few years ago. Maytas has now grown big and comprises Maytas Infra and Maytas Properties. The former’s order book is over Rs 12,000 crore besides the Hyderabad Metro Rail project.

Satyam Computers has reserves of Rs 8500 crore. “All indications are that they want to exit, but by selling out they will lose control of this money. That is why I cannot figure out why they want to sell out,” a chief financial officer of a top corporate told TOI. “Unless you see it as an instance of the promoters being potentially forced out of the company by the shareholders. But nothing similar has happened in India before,” said Amitabha Guha, former deputy managing director of SBI.

Satyam Rajus Looking for Strategic Partner?

By M H Ahssan

Faced with a virtual revolt from various stakeholders, including the very same independent directors who had cleared the controversial Maytas buyout proposal, the Rajus of Satyam Computers are actively considering inducting a strategic partner and selling out their shares in the $ 2-billion IT company.

Late on Saturday evening, the company while postponing its board meeting from December 29 to Jan 10, announced the appointment of DSP Merill Lynch to advise on "strategic options to enhance shareholder value." A company release also talked of a "possible dilution of promoters' stake in the company." Analysts said that these two points when read together could mean that the Rajus are looking at an exit route and bringing in other investors. "The promoters own only 8.6 per cent of the company's shares. That is very low. Dilution could mean that they go out," averred Monotosh Sinha, executive director of Centrum Capital.

Satyam will also recast its board of directors: some board members are expected to exit, while some new faces could come on board. The Satyam release suggested that the next board meeting will consider "measures to strengthen the company's goverance structure, including the size and altering the composition of the board." Facing flak from all quarters, ISB dean M Rammohan Rao, who chaired the controversial meeting that okayed the Maytas deal, is expected to leave the board. But father of Pentium, Vinod Dham, who told TOI that he had asked for a special board meeting to consider all matters pertaining to the company is expected to continue and play a pivotal role. "He is a well-known name in technology circles in the US. And the stockmarket there would react positively to his continuance on the board," an analyst pointed out. Dham, along with Harvard Business School professor Krishna Palepu, is expected to physically attend the board meeting: in the past, the two usually participated through video conferencing.

Sources expected that if the sell-out by Satyam does not happen or till such times that it happens, B Rama Raju, the co founder and brother of Ramalinga Raju and managing director of the company, will step down from his executive position and make way for a salaried professional as managing director. "He will continue as a non executive director," sources averred. Similarly, it is expected that Ramalinga Raju might himself become a non executive chairman of the Satyam board.

IBM likely to takeover Satyam?
Stories about the disinclination of the Rajus to continue with Satyam Computers have been doing the rounds for the last two years with the constant buzz being that IBM would possibly takeover the company. “Though constantly denied, the fact that these tales persisted only shows that there cannot be smoke without fire,” says a top Hyderabad businessman known to Ramalinga Raju for long.

Raju who started off his entrepreneurial career in the construction business has a fascination for the real estate and related industry, say people who know him. This is precisely the reason why Maytas (which is Satyam spelt in reverse) was spawned by Ramalinga Raju a few years ago. Maytas has now grown big and comprises Maytas Infra and Maytas Properties. The former’s order book is over Rs 12,000 crore besides the Hyderabad Metro Rail project.

Satyam Computers has reserves of Rs 8500 crore. “All indications are that they want to exit, but by selling out they will lose control of this money. That is why I cannot figure out why they want to sell out,” a chief financial officer of a top corporate told TOI. “Unless you see it as an instance of the promoters being potentially forced out of the company by the shareholders. But nothing similar has happened in India before,” said Amitabha Guha, former deputy managing director of SBI.

Realty cos Diversifying into Education

By M H Ahssan

Education is proving to be quite a draw with a new breed of entrepreneurs in Kolkata. A bunch of real estate developers are diversifying into education and looking at rolling out schools, management institutes and engineering colleges, most of them as a notfor-profit or CSR activity.

The likes of the Ambuja Group, South City, PS Group, among others are all looking at education, drawn by the sheer longterm opportunities which the sector offers. Though realtors have been setting up schools as part of large integrated projects, which also boast of amenities like shopping areas and medical facilities, these players are different in the sense that they are looking at these educational ventures as independent projects in themselves.

PS Group CMD Pradip Kumar Chopra said around 80-85% of the initial investment in setting up an education project goes towards infrastructure and land cost. “Since we are already experts in real estate, we can then save nearly 30% of the initial cost. Hence, this would make such projects more viable,” said Mr Chopra. PS Group has already acquired two 25-acre plots in Rajarhat and Bantala for their proposed education ventures. This includes a B-school and an integrated education hub, which will offer everything from school to doctoral-level education.

South City Projects is also aggressively promoting its South City International School within its residential complex, conceptualised by educational consultant Shomie Das, ex-principal, Doon School and supposedly tutor to none other than Prince Charles! The school will offer five certificates including ICSE, ISC, IBO, Geneva, IGCSE (‘O’ and ‘A’ levels). South City director Pradeep Sureka claimed, “Many people have actually bought flats just to avail of the school, which starts operations in April 2009. It may also prove to be an employment avenue to some of our residents.”

Harshavardhan Neotia, chairman, Ambuja Realty told ET, “As part of our CSR activities, our foundation has recently taken over the Institute of Technology and Marine Engineering on Diamond Harbour Road from its earlier promoters. Right now, it has 1,200 students and six streams of engineering. In due course, we intend to add management and hospitality education.”

Realty cos Diversifying into Education

By M H Ahssan



Education is proving to be quite a draw with a new breed of entrepreneurs in Kolkata. A bunch of real estate developers are diversifying into education and looking at rolling out schools, management institutes and engineering colleges, most of them as a notfor-profit or CSR activity.



The likes of the Ambuja Group, South City, PS Group, among others are all looking at education, drawn by the sheer longterm opportunities which the sector offers. Though realtors have been setting up schools as part of large integrated projects, which also boast of amenities like shopping areas and medical facilities, these players are different in the sense that they are looking at these educational ventures as independent projects in themselves.



PS Group CMD Pradip Kumar Chopra said around 80-85% of the initial investment in setting up an education project goes towards infrastructure and land cost. “Since we are already experts in real estate, we can then save nearly 30% of the initial cost. Hence, this would make such projects more viable,” said Mr Chopra. PS Group has already acquired two 25-acre plots in Rajarhat and Bantala for their proposed education ventures. This includes a B-school and an integrated education hub, which will offer everything from school to doctoral-level education.



South City Projects is also aggressively promoting its South City International School within its residential complex, conceptualised by educational consultant Shomie Das, ex-principal, Doon School and supposedly tutor to none other than Prince Charles! The school will offer five certificates including ICSE, ISC, IBO, Geneva, IGCSE (‘O’ and ‘A’ levels). South City director Pradeep Sureka claimed, “Many people have actually bought flats just to avail of the school, which starts operations in April 2009. It may also prove to be an employment avenue to some of our residents.”



Harshavardhan Neotia, chairman, Ambuja Realty told ET, “As part of our CSR activities, our foundation has recently taken over the Institute of Technology and Marine Engineering on Diamond Harbour Road from its earlier promoters. Right now, it has 1,200 students and six streams of engineering. In due course, we intend to add management and hospitality education.”

Realty cos Diversifying into Education

By M H Ahssan

Education is proving to be quite a draw with a new breed of entrepreneurs in Kolkata. A bunch of real estate developers are diversifying into education and looking at rolling out schools, management institutes and engineering colleges, most of them as a notfor-profit or CSR activity.

The likes of the Ambuja Group, South City, PS Group, among others are all looking at education, drawn by the sheer longterm opportunities which the sector offers. Though realtors have been setting up schools as part of large integrated projects, which also boast of amenities like shopping areas and medical facilities, these players are different in the sense that they are looking at these educational ventures as independent projects in themselves.

PS Group CMD Pradip Kumar Chopra said around 80-85% of the initial investment in setting up an education project goes towards infrastructure and land cost. “Since we are already experts in real estate, we can then save nearly 30% of the initial cost. Hence, this would make such projects more viable,” said Mr Chopra. PS Group has already acquired two 25-acre plots in Rajarhat and Bantala for their proposed education ventures. This includes a B-school and an integrated education hub, which will offer everything from school to doctoral-level education.

South City Projects is also aggressively promoting its South City International School within its residential complex, conceptualised by educational consultant Shomie Das, ex-principal, Doon School and supposedly tutor to none other than Prince Charles! The school will offer five certificates including ICSE, ISC, IBO, Geneva, IGCSE (‘O’ and ‘A’ levels). South City director Pradeep Sureka claimed, “Many people have actually bought flats just to avail of the school, which starts operations in April 2009. It may also prove to be an employment avenue to some of our residents.”

Harshavardhan Neotia, chairman, Ambuja Realty told ET, “As part of our CSR activities, our foundation has recently taken over the Institute of Technology and Marine Engineering on Diamond Harbour Road from its earlier promoters. Right now, it has 1,200 students and six streams of engineering. In due course, we intend to add management and hospitality education.”

Realty cos Diversifying into Education

By M H Ahssan



Education is proving to be quite a draw with a new breed of entrepreneurs in Kolkata. A bunch of real estate developers are diversifying into education and looking at rolling out schools, management institutes and engineering colleges, most of them as a notfor-profit or CSR activity.



The likes of the Ambuja Group, South City, PS Group, among others are all looking at education, drawn by the sheer longterm opportunities which the sector offers. Though realtors have been setting up schools as part of large integrated projects, which also boast of amenities like shopping areas and medical facilities, these players are different in the sense that they are looking at these educational ventures as independent projects in themselves.



PS Group CMD Pradip Kumar Chopra said around 80-85% of the initial investment in setting up an education project goes towards infrastructure and land cost. “Since we are already experts in real estate, we can then save nearly 30% of the initial cost. Hence, this would make such projects more viable,” said Mr Chopra. PS Group has already acquired two 25-acre plots in Rajarhat and Bantala for their proposed education ventures. This includes a B-school and an integrated education hub, which will offer everything from school to doctoral-level education.



South City Projects is also aggressively promoting its South City International School within its residential complex, conceptualised by educational consultant Shomie Das, ex-principal, Doon School and supposedly tutor to none other than Prince Charles! The school will offer five certificates including ICSE, ISC, IBO, Geneva, IGCSE (‘O’ and ‘A’ levels). South City director Pradeep Sureka claimed, “Many people have actually bought flats just to avail of the school, which starts operations in April 2009. It may also prove to be an employment avenue to some of our residents.”



Harshavardhan Neotia, chairman, Ambuja Realty told ET, “As part of our CSR activities, our foundation has recently taken over the Institute of Technology and Marine Engineering on Diamond Harbour Road from its earlier promoters. Right now, it has 1,200 students and six streams of engineering. In due course, we intend to add management and hospitality education.”

BPOs Back In Demand

By M H Ahssan

The global economic slowdown is beginning to spell a windfall for some BPO firms. Companies such as WNS, EXL, Steria and Quatrro are finding new opportunities as clients aggressively pursue cost-cutting.

“With reality dawning that these are going to be tough times, companies have become more aggressive on outsourcing,” said WNS (Holdings) CEO Neeraj Bhargava. The BPO firm recently renewed its contract with Centrica that includes a new, three-year transformational plan for streamlining the energy firm’s operations. WNS, which is witnessing traction in utilities, telecom and insurance, is in active discussions for 5-6 deals that it expects to close in the next quarter.

BPO firm ExlService Holdings says the last few weeks have seen clients cut down on their decision-making time to four weeks from 12-18 weeks earlier. “There is a healthy business pipeline and there is a fair number of companies looking to cut costs,” president and CEO Rohit Kapoor said. Apart from insurance vertical, the firm is also seeing demand for finance and accounting work in retail and manufacturing.

Clients are now looking towards their outsourcing vendors to suggest ways to cut costs, Genpact president and CEO Pramod Bhasin had said recently. “There are some project cancellations but there are new opportunities too.”

As per a report by telecom and software consulting firm Ovum, BPO will overshadow the importance of IT in the outsourcing market in 2009. While there is lower level of offshoring in BPO at present, it is more non-discretionary in nature.

“As companies cut back on resources, they will look at outsourcing more work,” Ovum’s Asia Pacific software and sourcing principal analyst Jens Butler said. For outsourcing services vendor Steria, its large exposure to public sector—about 36% of revenues come from the vertical—is an advantage. “We have seen orders go up in the public sector as governments try to revive the economy by spending more,” Steria CEO Mukesh Aghi said. The firm’s joint venture with UK’s Department of Health recently won outsourcing contracts worth £13.8 million to provide finance, accounting and payroll services to 12 national health service organisations.

Quatrro BPO solutions has seen great demand for foreclosures and legal process outsourcing (LPO) work. MD Raman Roy says his top management is focusing on bringing out solutions related to government bailouts. Amid all this, banking and financial services is also showing some activity. While WNS is seeing some pick-up in demand from banking companies, EXL’s Mr Kapoor said financial services firms in the US are looking at outsourcing partners for regulatory compliance work.