Satyam to go for board revamp in Aug

India’s No 4 software exporter Satyam Computer Services is set to reorganise the composition of its board of directors next month in a bid to streamline the day-to-day operations and management of the company.

The Hyderabad-based consulting and IT services company, which figures among the Top 5 companies in the country’s software exports pantheon, might also look at nominating members from newly acquired companies to its board, according to sources.

A company source could not confirm news of Satyam’s board revamp or how inorganic growth plans were making headway. “What is clear is that a reorganisation of the board is planned to realise stronger synergies between different verticals and also accommodate new directors on the board. No reduction in the number of people is planned yet,” the source said. Satyam’s spokesperson, when contacted, declined comment.

Satyam currently has nine members on its board, including founder chairman B Ramalinga Raju. The members are managing director B Rama Raju, president Ram Mynampati and venture capitalist Vinod K Dham, who is on the board since January 2003.

With cash reserves of Rs 4,800 crore, the company has been on the lookout for acquisition targets and believes that strategic fits in the finance and accounting (F&A) areas or BPO segments will help take these businesses to the next level of growth.

With plans to further extend its nearshore capabilities in the F&A space, Satyam is setting up IT and BPO development centers in Mexico, Chile, and Uruguay. It has opened centres in Egypt, Brazil and Australia, and is also targeting areas outside the US, specifically Asia Pacific, West Asia and Europe.

Satyam has made small acquisitions in the F&A, analytics and consulting spaces over the last two years, keeping in mind fast revenue turnaround times and optimum utilisation of acquired staff.

For example, Citisoft, a business and systems consulting company specialising in the investment management space was acquired by Satyam in April 2005. Satyam has spent about $270 million on carrying out key acquisitions over the past year. In January this year, Satyam purchased the Chicago-based Bridge Strategy Group in an all-cash deal of $35 million to strengthen its own strategic consulting and business transformation capabilities.

In April, the company acquired the market research and customer analytics (MR&CA) operations of Caterpillar for $60 million. The same month, Satyam bought Belgium-based supply chain management consulting firm S&V Management Consultants for $35.5 million.

Satyam is reportedly in talks with some clients for long-term transformational deals, in the range of $30-50 million, that would combine strategic IT services and consulting with BPO offerings. The US contributes 60 per cent of the company’s business volumes, Europe accounts for 19.5 per cent and 20.5 per cent comes from the rest of the world.