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2 more Satyam directors quit, more may follow

December 29, 2008 15:29 IST

Two more directors on Monday resigned from the board of Satyam Computer Services [Get Quote], taking the number to three, following differences over an abortive acquisition deal involving two firms promoted by chairman Ramalinga Raju's family.

The NYSE-listed company on Monday announced the resignation of non-executive director Krishna G Palepu, and non-executive and independent director Vinod K Dham from the board, with effect from Sunday.

On December 25, the board's longest serving member Mangalam Srinivasan had resigned from the board owning moral responsibility for the fiasco over the Maytas acquisitions that raised questions about the role of independent directors and corporate governance issues.

Satyam, which deferred its board meeting scheduled for Monday to January 10, had earlier said it is looking at various options to increase shareholders value which also include reconstitution of the board.

B Ramalinga Raju, company chairman, said, "Amongst other items that are being taken up for consideration in the board meeting scheduled on January 10, 2009, reconstitution of board will be an important item."

However, the company said on Monday that Satyam promoters have pledged all their shares to institutional investors, who may have sold a part of it to recover dues.

Satyam shares are trading at Rs 146.25, up 7.93 per cent on the Bombay Stock Exchange.

Earlier this month, Satyam announced the acquisition of two companies promoted by the family of Raju, but had to call off the deal within hours follwing investors' dissent.

The ADR of Satyam took a 55 per cent hammering after the company announced the deal on December 16.

Also see:

World Bank bars Satyam for 8 years
Sebi finds no violation by Satyam
A new low for India Inc
Just what went wrong?
How Satyam case has dented India Inc's image

Satyam calls off $1.6-bn Maytas deal
Satyam under fire for $1.6 bn Maytas deal

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