Satyam hammered on ban by World Bank

Satyam Computer Service plunged 14.17% at Rs 120.50 on BSE after the World Bank barred the company from doing business with it for eight years.
The stock hit a 52-week low of Rs 122.25 in early trade. The stock hit a high of Rs 124.35 so far in the day. The stock had a 52-week high of Rs 544 on 30 May 2008.
India's fourth largest software exporter by sales has an equity capital of Rs 134.77 crore. Face value per share is Rs 2.
The current price of Rs 120.50 discounts its Q2 September 2008 annualised EPS of Rs 35.48, by a PE multiple of 3.39.
Satyam Computer Services' American depository receipt slumped 11.02% on Wednesday, 23 December 2008 after the World Bank confirmed an earlier report that it has barred Satyam Computer Services from doing business with it for eight years, starting September this year, due to data theft and paying bribes to its staff.
The World Bank, which had signed a $100-million billing per annum contract, had been an important client for Satyam. Since 2003, Satyam had been writing and maintaining all software for World Bank across all locations. This also included maintenance of software in back-end offices.
The Satyam Computer Services stock had tanked 13.55% to Rs 140.40 on Wednesday, 22 December 2008 amid rumours that its founder and chairman B Ramalinga Raju was stepping down from the board
Satyam Computers during trading hours on 18 December 2008 said its board will meet on 29 December 2008 to consider buyback of shares. The announcement was aimed at soothing investor nerves after the Satyam stock slumped 30.22% on 17 December 2008. Investors had chucked the stock following the company's announcement after market hours on 16 December 2008 of a $1.6 billion deal to acquire Maytas Properties and Maytas Infrastructure, companies run by Raju's sons B Rama Raju and Teja Raju.
Satyam scrapped a $1.6 billion acquisition of companies connected to its chairman after the plan angered investors. The company's total disregard for corporate governance and shareholders was shocking - Satyam had no plan to take the proposal to minority shareholders.
Satyam had announced that it will acquire 100% in unlisted Maytas Properties for $1.3 billion and 51% of construction firm Maytas Infra for $300 million. Satyam founder and Chairman B. Ramalinga Raju and other insiders hold 36% in Maytas Infra and 35% in Maytas Properties.
Satyam had planned to fund 75% of the acquisition with cash and the rest by selling debt. Satyam planned to acquire 31% in Maytas Infra from its promoters, or company insiders, at a price of Rs 475 a share. Satyam also planned to make an open offer for an additional 20% at a price of Rs 525 a share.
Maytas Properties is into urban infrastructure development whereas Maytas Infra is into infrastructure construction and asset development. Ramalinga Raju originally promoted the deal by saying it would de-risk Satyam's core business in IT services.
Satyam Computer Services' net profit rose 3.70% to Rs 597.43 crore on 6.87% increase in net sales to Rs 2700.52 crore in Q2 September 2008 over Q1 June 2008.
Satyam Computer Services is a global business and information technology services company. It delivers consulting, systems integration and outsourcing solutions to clients.