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Rajus made over Rs 3K cr since 2000 by offloading stakes
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Rajus made over Rs 3K cr since 2000 by offloading stakes
Satyam Computer Services’ arrested founder Ramalinga Raju and family systematically offloaded their stakes in the company while artificially inflating the stock price with imaginary profits and brand-building efforts, the Serious Fraud Investigation Office (SFIO) has told the government after its three-month probe into the country’s worst corporate scandal.
The promoters gained a total of Rs 3,029 crore since 2000, when the Satyam scrip was on a bull run. The scrip had closed at an all-time high of Rs 7,081 in February 2000. SFIO, a multi-disciplinary investigation agency with officials from various law enforcement agencies, has told the government in its report that promoters misled investors about the worth of the company by spending huge sums on brand building and by embellishing its books with fictitious profits and non-existent debtors.
The offloading of stake by Mr Raju and his relatives began on April 1, 2000, when software companies made a fortune from the Y2K solution business. It continued till Mr Raju admitted to the fraud on January 7, 2009. To maintain the high share price, Satyam depicted a healthy picture of the company year after year by inflating sales and current assets figures. The manipulations were done to maintain competitive financial ratios vis-à-vis rivals in the software services industry, an official with the ministry of corporate affairs, said.
Source:
http://economictimes.indiatimes.com/Infotech/Software/Rajus-made-over-Rs-3K-cr-s
The promoters gained a total of Rs 3,029 crore since 2000, when the Satyam scrip was on a bull run. The scrip had closed at an all-time high of Rs 7,081 in February 2000. SFIO, a multi-disciplinary investigation agency with officials from various law enforcement agencies, has told the government in its report that promoters misled investors about the worth of the company by spending huge sums on brand building and by embellishing its books with fictitious profits and non-existent debtors.
The offloading of stake by Mr Raju and his relatives began on April 1, 2000, when software companies made a fortune from the Y2K solution business. It continued till Mr Raju admitted to the fraud on January 7, 2009. To maintain the high share price, Satyam depicted a healthy picture of the company year after year by inflating sales and current assets figures. The manipulations were done to maintain competitive financial ratios vis-à-vis rivals in the software services industry, an official with the ministry of corporate affairs, said.
Source:
http://economictimes.indiatimes.com/Infotech/Software/Rajus-made-over-Rs-3K-cr-s
