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Indian computer giant delisted after scandal

  • Story Highlights
  • Indian computer giant Satyam has been delisted from stock index
  • Satyam employs 53,000 people and operates in 65 countries
  • Chairman B. Ramalinga Raju said balance-sheet padding began years ago
  • Raju said no board member was aware of what he was doing
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NEW DELHI, India (CNN) -- India's main stock exchange -- the BSE SENSEX -- delisted Satyam Computer Services from its indices Thursday, a day after the company's chairman resigned saying he had inflated the company's profits for years.

Satyam Chairman B. Ramalinga Raju

Satyam Chairman B. Ramalinga Raju

The stock exchange took the steps soon after Satyam's interim chief executive officer held a press conference Thursday to say that the company's immediate goal was to continue its operations uninterrupted.

Satyam, India's fourth-largest software-services provider, serves almost 700 companies, including 185 Fortune 500 companies, and generates more than half its revenues from the United States.

After Chairman B. Ramalinga Raju confessed that he had inflated profits with "fictitious" assets and non-existent cash, stocks of the Hyderabad-based company plummeted more than 70 percent and the BSE SENSEX fell 7.3 percent Wednesday.

Raju said the balance-sheet padding began several years ago to close "a marginal gap" between actual operating profit and one reflected in the company's accounting books. It continued through the years, he said in a letter to the company's board of directors.


The deception came to light after Raju tried to plug the hole by getting Satyam to buy his son's construction companies. The acquisition was "the last attempt to fill the fictitious assets with real ones," he wrote in his letter.

The deal would have cost Satyam $1.6 billion, but the company's board vetoed it.

-- CNN's Bharati Naik contributed to this report.

All About IndiaSatyam Computer Services Ltd.

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