Even more Satyam sense
The Saytam story just took on another interesting turn. As I’d said before in my previous post, the actual business at Satyam seemed viable and the inflation had distorted some of the figures and nothing more. Now it seems that even the inflation was not really true but just a ploy to divert attention the the real scenario – that Mr. Raju was robbing the company blind.
All of Satyam’s revenue and profit figures seem to be accurate. The difference in the originally reported accounts and the ones alleged by Raju was actually what he stole and pumped into Maytas Properties (which is an unlisted real estate company and is distinct from the listed Maytas Infrastructure, which is a construction company) or his own personal holdings.
The original plan would have gone something like this.
- Siphon off tons of cash from the hugely cash-generative IT business and use it to buy major chunks of land (Raju through Maytas and personally is one of the country’s 10 largest landowners).
- List Maytas Properties sometime in 2008 and raise a gazillion or so dollars.
- Funnel the extra cash back into Satyam and no one would be the wiser.
This is what went wrong. The economy crashed and burned. The planned listing of Maytas Properties went out the door and suddenly Raju was left with a massive but wholly illiquid land bank and no way of making good on the Satyam stealing. The letter of apology was actually a masterstroke that diverted the authorities completely and made Raju out to be a perhaps dishonest but well-meaning man. It was also most probably done under severe political pressure as the real story (which is unfolding now) would have implicated too many of our esteemed politicians from both the current and previous governments.
If the letter story had stuck, Raju would have been embrolied in cases for a while, but his personal assets would have been untouched and probably made a lot more money for his family. Needless to say, with his still impressive clout, he wouldn’t have spent much (if any) time in jail. The real story seems to have come out (and this is only speculation on my part) when Vadlamani (the CFO who tried to commit suicide) “sang like a canary” to the cops.
Stay tuned for more on the Satyam show. I’m sure it’ll get more interesting.
It is a open secret that CM of Andhra Pradesh is indirectly linked to this fraud. Interesting to know how is CM and Congress linked ??? We all know CM is protecting Raju now.