B Ramalinga Raju, the defamed founder of Satyam Computers, and his family attempted to bid for the beleaguered IT firm, even as one of the pre-conditions for bidding was a good corporate governance track record.
The revelation that the erstwhile promoter of Satyam featured in the initial list of 141 suitors is understood to have been made by TN Manoharan, a government-nominated member on the Satyam board and former chairman of the Institute of Chartered Accountants of India (ICAI) at a conference of the Southern India Regional Council of the regulatory body on Sunday.
Bidders who expressed an interest in Satyam were only privy to the takeover norms stipulated by the board such as a three-year-lock-in for a strategic investor and a ban on asset stripping for two years, among other things. They were, however, not given any access to the virtual data room including the financial position as well as assets and liabilities of Satyam, once ranked the fourth-largest software exporter of the country.
The marque list of bidders included engineering firm L&T, billionaire investor Wilbur Ross, IT services firm Tech Mahindra, BK Modi-promoted Spice Group and IT services firm Cognizant Technologies.
But Mr Manoharan, it is learnt, did not elaborate on the attempt by Satyams promoters to bid for the firm. Raju was arrested in early January this year after he confessed to fudging the IT firms books to perpetrate the countrys biggest-ever corporate fraud.
The Satyam board was superseded and replaced with a six-member government-nominated board to bring in financial stability and rope in a strategic investor. The race narrowed down to three bidders and Tech Mahindra, the highest bidder, was selected as Satyams new owner in less than 100 days.
Mr Manoharan and C Achutan, former presiding officer of the Securities and Appellate Tribunal, are on Mahindra Satyams (formerly Satyam Computers) board. We are members in the audit committee and our main role is to oversee the compliance of takeover norms by the new owner, Mr Manoharan said later.
The former president of ICAI told his fraternity that the Council could consider making it mandatory for external auditors to do the internal audit for companies. Currently, only half of the top 500 companies have external auditors for their internal audits.
The role of auditors and independent directors came under a cloud after the Satyam scam. The Satyam episode has marred the image of our profession, but onsite experience shows that we must have the courage of conviction to respond and say that an aberration cannot be used to tarnish our entire profession, he is understood to have said.