Satyam shares recover as new board plans rescue

12 January 2009

Shares in IT outsourcing specialist Satyam have recovered by around 60 per cent after the Indian government installed three new board members to lead a rescue of the scandal hit firm, reports say.

The move followed the dismissal of the company's entire board after last week's admission by former chairman B Ramalinga Raju that he had conducted a $1 billion accounting fraud, the BBC stated.

Mr Raju and his brother, who also sat on Satyam's board, have now been arrested on charges including conspiracy and forgery.

The news site added that Satyam's chief financial officer, Vadlamani Srinivas, is also being questioned by police investigating the case.

Meanwhile, Kiran Karnik, the former head of technology group Nasscom, ex-Securities and Exchange Board of India member C Achuthan and banker Deepak Parekh have been installed with the task of saving what is India's fourth-biggest provider of software services.

Satyam, which employed around 52,865 people at the end of September and has clients including the US government and General Electric, is based in Hyderabad, with development centres in locations including Chicago, Sydney, Mumbai, Sao Paulo and Tokyo.

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