The media and the investor community went to town when Raju made the announcement of Satyam taking over Maytas.Everybody said that this was being done to benefit Maytas.And that Maytas was being bailed out by Satyam.
We then saw the deal getting canceled.
Today we saw that Satyam was actually trying to transfer Maytas's assets to Satyam for ZERO VALUE in return(since there's no cash with Satyam and hence the payout would have been only on paper)
If the original deal had gone through then everything would have been well and fine.
Satyam would have had physical assets in place of fictitious cash.Some solace at least.Owning Rs 5000 crores or maybe less worth of land/assets would have been lot better than fictitious cash.
Maytas would have become non -existent .Raju would have got back his focus on growing Satyam.
Investors would have been more happy with THAT situation than NOW as the Balance sheet would have been stronger.
Same with 53,000 employees.
All of us would have been better off.
In fact,Maytas was actually bailing out Satyam and not the other way around.
Think.Rethink.
Mine is just a contra point of view.In no way I am holding the brief for Raju. He deserves his desserts for what he did to India/Hyderabad/IT industry/Real estate industry/Raju community/our conscience. SATYAM is now ASATYAM (A bunch of lies).
We then saw the deal getting canceled.
Today we saw that Satyam was actually trying to transfer Maytas's assets to Satyam for ZERO VALUE in return(since there's no cash with Satyam and hence the payout would have been only on paper)
If the original deal had gone through then everything would have been well and fine.
Satyam would have had physical assets in place of fictitious cash.Some solace at least.Owning Rs 5000 crores or maybe less worth of land/assets would have been lot better than fictitious cash.
Maytas would have become non -existent .Raju would have got back his focus on growing Satyam.
Investors would have been more happy with THAT situation than NOW as the Balance sheet would have been stronger.
Same with 53,000 employees.
All of us would have been better off.
In fact,Maytas was actually bailing out Satyam and not the other way around.
Think.Rethink.
Mine is just a contra point of view.In no way I am holding the brief for Raju. He deserves his desserts for what he did to India/Hyderabad/IT industry/Real estate industry/Raju community/our conscience. SATYAM is now ASATYAM (A bunch of lies).
.jpg)
3 comments:
A truly different dimension. If the deal would have happened, as you said, everything would have been fine.
But thanks to all the drama that happened, good for the aam janta, today the world knows how he has played around in the balance sheet. I only pity the employees of Satyam who responded to the internall call and invested in the stock!!!!
Exactly my thoughts too! It might not have been the best way to manage business....but hell...better than the bloodbath of yesterday!
Yes, you are right. The shareholders got fooled for the first time when the inflated/ fictious profits and cash assets were created. They did not have any idea: they believed in what Promoters' did as something good for them but that was actually harmful to them. Second time, they got fooled in believing something that the promoters tried to do, namely to buy Maytas as something bad for them when it would actually have been good for them. This getting fooled behaviour is normall for shareholders in general do: cause harm to themselves by acting on reports/ news/ recommendations of and in believing promoters, auditors, cradit rating agencies, analysts and the media in turns. The basic truth is that how things go wrong in companies are generally not discernible to outsiders even if they are professional rating/ analysts agencies or experts or newsgatherers or regulators or auditors.
But had the Mayata deal gone through everything would not have been fine. One crime of fictious profit and asset creation cannot really be offset by another crime of fictous transaction to create real assets. The damage such squaring of a pair of fictious transactions deals is much more when such crimes renain undetected rather than getting exposed at the earliest possible opportunity. The technology of fictous accounts and deals would have slowly spread like a virus to spread throughout the corporate sector. This even Raju would now have realised as he has indeed: riding on the tiger. It is the tiger that ultimately forced Rahu to become honest and admit his wrng doings.
Now the danger of successive crines remaing undetected is more: the accounting and disclosure system is such that fictous transactions cannot be kept undetected for long: t would have been a greater diaster for corporate sector and Indian economy had the Maytas deal had gone through.
It is bad that it was poosible to plan and implement fictitious transaction and keep it secret for long: but it is good and remarkable that the accounting and disclosure systems as well as the auditing systems are so inherently strong that huge large frauds are unsustainable for managements and promoters.
Yes, if detection of the crimes had occured soon after the Maytas deal had gone through, Satyam shareholders would have probably suffered less in the short-term, but the long-term damage to shareholders in general and the economy. Even if some frauds may never be known, it is better that frauds get detected at the earlist, even if they could not have been prevented.
Wait till investigations reveal more. And, do not expect bad frauds and good frauds together can beat the double entry book keeping system for long.
What wonders me is, not the nature of artifial transactions, not the huge amounts involed. What strikes me is that audits failed to detect such crimes sooner rather than later.
Post a Comment