Hyderabad/New Delhi, Jan 17 (PTI): Satyams disgraced chairman Ramalinga Raju had made an emotional pitch that the company faced a takeover threat from IBM and the likes, to avert which he wanted the boards support for diversification.
Returning from the US ahead of the crucial December 16 board meeting — where Satyam proposed the acquisition of two Maytas firms — Raju had told the board that IBM and another company were interested in Satyam because of its strong cash balances, a member present at the meeting said.
He also warned that after the takeover, pink slips could be issued, the member said on the condition of anonymity.
To avoid this, Raju urged the members, in an informal pitch before the meeting commenced, to take what is known in the corporate world as a poison pill. His suggestion was that Satyam should enter sectors where IBM and their likes would have no interest.
Subsequently, the board was given presentations on the proposed takeover of Maytas Infra and Maytas Properties for Rs 8,000 crore.
According to the member, 75 per cent of the funding for the Maytas deal would have come from internal accruals and the remaining from borrowings.
He said the companys auditors had told him that they themselves had physically verified from the banks the deposits in the companys accounts. There was Rs 3,319 crore in about nine banks, he said.
After the deal failed to go through, Raju had told the board while announcing his resignation that as the promoters held a small percentage of equity, the concern was that poor performance would result in a takeover, thereby exposing the gap (between real and fictitious assets).