Won't pick further stake in Satyam: L&T

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Minister for Corporate Affairs PC Gupta said the government has elected three members to Satyam's board. These include HDFC chief Deepak Parekh, former Nasscom President Kiran Karnik, and former Sebi member C Achuthan.

 

Commenting on the development in Satyam, YM Deosthalee, CFO, L&T said the government's initial action of forming a new board is definitely a very good and welcome move and the persons elected on the board are all good names. 

 

He clarified that L&T won't pick up anymore stake in Satyam. "We will see how the developments take place going forward and then take a decision. The new board is going to work to make sure that this company survives. We will take a decision and will decide what to do once the picture becomes very clear."

 

Here is a verbatim transcript of the exclusive interview with YM Deosthalee on CNBC-TV18. Also watch the accompanying video.

 

Q: Your initial reactions- three members have been appointed today on board of Satyam are you happy with what the government has announced today?

 

A: As government's initial action of forming a new board is definitely a very good welcome move, excellent move. The second thing is about the names and they are good names, and it all depends now on what is the mandate for the board and how they are going to function.

 

Q: Your company had picked up almost 4% stake in Satyam in the last week or so, would you now like to see that increased in terms of more stake and as well as in terms of a strategic alliance possibly because L&T has a very large IT business as well. So, would you like to work closely with Satyam, in terms of maybe coming in and helping out Satyam or in any other way would you like to join the actions at Satyam?

 

A: Let me clarify two three things; First, we did not pick up any stake after this debacle. The stake was picked up earlier than that. But we haven't picked up anything; we haven't sold after the problem which came up. 

 

The second point is that we very clearly clarify that actually the intention was to see whether we could form some kind of an alliance with this company. There is some synergy between their businesses and our IT businesses. Let's see going forward how things emerge. (But) that was the idea behind the stake.

 

However, now after this recent development, we won't pick up anymore stake and we will see how the developments takes place going forward and then take a decision. The key thing is, if there is a possibility I am sure the board is going to work on that to salvage this company, to make sure that this company survives and then the employees, the customers and all of them get confidence by hiring out the formation of the board and actions, which they take. We will take a decision and we will decide what to do hereafter once the picture becomes very clear.

 

Q: You clearly said that you will not be picking up anymore stake, why is that?

 

A: Right now we don't think that we will pick up anymore stake, as I said earlier this company which is there; we do not know what is the legal position, what are the liabilities inside, what are the contracts, what is the profitability nothing is clear in the company. Therefore it is very difficult for us to pick up any further stake. So, at this point in time we have decided not to do anything, let's wait and see how things develop.