Satyam Computers Corporate Governance Fiasco (G): Maytas Satyam?


Code : GOV0047

Year :

Industry : Services

Region : US

Teaching Note: Available

Structured Assignment : Available

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Seventh in the series of Satyam Computers Corporate Governance Fiasco, this case study focuses on the events starting from December 16th 2008 to July 30th 2009, during which the Maytas twins – Matyas Properties and Maytas Infra, underwent huge termoil. The two firms, were thorn in flesh for the investors of Satyam Computers for more than a decade. Acquisition of 51% stake in Satyam Computers by Tech Mahindra had finally censured the umbilical cord of Maytas twins with the parent company.
This case study examines the main factors that forced the two firms into financial crisis after revelations of self-proclaimed fraud by the founder, CEO of Satyam Computers, Ramalinga Raju, whose sons were in-charge of Maytas twins. The guidelines provided by the Company Law Board and the Corporate Debt Restructuring package approved by 18 lending banks provided lifeline for the Maytas firms, which restarted their businesses. However, the Andhra Pradesh government’s cancellation of the concession agreement with Maytas Infra with respect to the Hyderabad Metro Rail project launched the firm in a new incertitude where the company’s brand value and financial viability were threatened. This case study provides a deep understanding of the tough times faced by the Maytas firms, resulting from the exposure of the biggest fraud at its parent company, Satyam Computers. .

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Pedagogical Objectives:
The case attempts to achieve the following pedagogical objectives:
To discuss the origin and growth of Matyas Properties and Matyas infra
To establish the inter-linkages between Matyas business plans and Satyam corporate governance fiasco
To analyse the factors that forced Maytas twins into the financial crisis
To debate, explore and analyse various options for Matyas Properties and Maytas Infra to stay afloat in its business.

Keywords :Corporate Governance, Satyam Computers, Corporate Governance Failures, Boards and Corporate Governance, Mahindra Satyam, Corporate Frauds in India, Ramalinga Raju, The Role of Government in Governance, Governance Codes, Corporate Governance in India

Contents :
» A Close Look at Hyderabad Metro Rail (HMR) Project
» Did State Government Favour Maytas?
» Satyam Computers-Maytas Deal: A Thorn in the Flesh?
» Impact on Maytas: Playing with Credibility

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