Restoring member confidence top priority: Satyam director

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TR Prasad, an independent director on the board of the beleaguered tech giant Satyam Computer Services , said restoring confidence of all shareholders is of utmost importance, reports CNBC-TV18. He said the board meeting will take place soon. "It would look at strengthening the company's corporate governance and would also discuss altering or increasing the size of the board."

 

"I intend to continue till dispensed with this public duty," Prasad said. He said he had no idea of promoter shares being pledged in the infamous abortive Maytas deal.

 

Institutional shareholders are likely to recommend independent directors to DSP Merrill Lynch, Prasad added. CNBC-TV18's Shereen Bhan spoke to TR Prasad.

 

Here is a verbatim transcript of Shereen Bhan's comments on CNBC-TV18. Also watch the accompanying video.

 

The other independent director left now on the Satyam board - apart from VS Raju - categorically said "doubts are being raised on the continuance of other independent directors on the Satyam board", from which four directors have already resigned. And he is of the view that "resigning is like deserting a troubled ship at this point in time". He talked about Satyam being a major global IT player that employees 50,000 professionals that has vendor commitments, to global corporation and entities. And hence he feels that it is the public responsibility because almost 90% of the company is owned by the public, and it is the public responsibility that he actually continues with the Satyam board at this point in time and sees this matter through.

 

He has said that the January 10 board meeting will look at restoring confidence of all stakeholders that he says is most important. One of the things that have been proposed for the meeting is strengthening corporate governance; the other would be increasing the size or altering the board. He says that until he finishes or dispenses with this responsibility - his public duty - he is going to continue with the board of Satyam as an independent director.

 

When specifically asked whether he had any information about Satyam promoters pledging their shares - sources say that could have been a sticky point with other ex-independent directors like Vinod Dham and Krishna Palepu - he said that he did not know till that information was made public to the stock exchanges. When asked Satyam could have spoken to any other [candidates for appointment of] independent directors, he said FIIs or institutional shareholders will contact DSP Merrill Lynch, which has been appointed outside advisor. DSP ML has been given the mandate and it would recommend some names for independent directors. TR Prasad, for now stays, as does VS Raju.

 

He also said the board meeting will discuss increasing the size and altering the board but was not sure whether they will actually be able to put in a new board or find replacements for those independent directors [who have resigned] on the January 10 itself. However, DSP Merrill Lynch, he said, is speaking with institutional shareholders as well as FIIs and they could be recommending some names. So, we will have to wait and see whether there will be an installation of a new board, or there will be names that will be discussed at that point.

 

It appears, though, that there still is confidence in Ramalinga Raju, and in the fact that this management and this promoter group does actually want to draw confidence and want to get the company out of the mess that they find themselves in.