Wednesday, December 24, 2008

Satyam falls 15% down as World Bank stop orders

HYDERABAD: The World Bank on Wednesday said Satyam Computer Services was debarred from getting direct contracts from it under its corporate procurement programme for eight years from September this year.

But it clarified there was no evidence of Satyam being involved in malacious attacks on the bank's information system. The company was declared ineliglible for contracts for providing improper benefits to bank staff and for failing to maintain documentation to support fees charged for its subcontractors, the bank said in a statement on Wednesday.

Satyam shares slid 15% to Rs 119 per share during the course of trading on Wednesday, the lowest since September 2003.

The World's Bank's disclosure has become an embarrassment for Satyam that is embroiled in an unrelated controversy after its aborted bid to buy two firms linked to its promoter B Ramalinga Raju.

The country's fourth largest software exporter faced a major shareholder rebellion last week after it announced plans to buy two firms linked to the promoter for $ 1.6 billion. The decision was endorsed by the Board. However, within a few hours Satyam called off the deal to buy Maytas Infra and Maytas Properties. It has, however, been tight-lipped on key questions on who did the valuation of the real estate firm.