Ramalinga Raju

Born:
September 16, 1954

Achievement:
Founder and Chairman of Satyam
Computer Services Ltd; Chosen as
Ernst & Young Entrepreneur of the
Year for Services in 1999.

Career:
Raju founded Satyam in 1987 after
venturing earlier into other businesses such as construction and textiles. He started
an IT company with 20 employees that obtained contracts for IT projects, mostly
from US companies. Satyam rapidly developed and became a multinational
company with thousands of employees spread over many countries. Raju showed a
strong social orientation and has been furthering the cause of social transformation
through.
Ramalinga Raju is one of the pioneers of the Information Technology industry in
India. He is the founder and Chairman of Satyam Computer Services Ltd.

History:
Ramalinga Raju was born on September 16, 1954 in a family of farmers. He did
his B.Com from Andhra Loyola College at Vijayawada and subsequently did his
MBA from Ohio University, USA. Ramalinga Raju had a stint at Harvard too. He
attended the Owner / President course at Harvard.

After returning to India in 1977, Ramalinga Raju moved away from the traditional
agriculture business and set up a spinning and weaving mill named Sri Satyam.
Thereafter he shifted to the real estate business and started a construction company
called Satyam Constructions. In 1987, Ramalinga Raju founded Satyam Computer
Services along with one of his brothers-in-law, DVS Raju. The company went
public in 1992. With the launch of Satyam Infoway (Sify) Satyam became one of
the first to enter Indian internet service market. Today, Satyam has a global
presence and serves 44 Fortune 500 and over 390 multinational corporations.
Awards:
• Ernst & Young Entrepreneur of the Year Services Award 1999.
• Dataquest IT Man of the Year Award 2000.
• Asia Business Leader Award 2002.
• Ernst & Young Entrepreneur of the Year 2007 (revoked after the fraud was
confessed).
• Golden Peacock Award for Corporate Governance 2008 (revoked after the fraud
was confessed).

Fraud:
A botched acquisition attempt involving Maytas (a company owned by his own
family) in December 2008 led to a plunge in the share price of Satyam. In January
2009, Raju indicated that Satyam's accounts had been falsified over a number of
years. He admitted to an accounting fraud to the tune of 7000 crore rupees or 1.5
Billion US Dollars and resigned from the Satyam board on January 7, 2009. In his
letter of resignation, Raju described how an initial cover-up for a poor quarterly
performance escalated: "It was like riding a tiger, not knowing how to get off
without being eaten." Raju and his brother, B. Rama Raju, were then arrested by
Andhra Pradesh police on charges of criminal breach of trust, criminal conspiracy,
cheating, falsification of records and forgery. Raju may face lifetime
imprisonment if convicted of misleading investors. Raju had also opened multiple
(dummy) accounts through relatives and friends and used them to trade in
Satyam's shares, violating the insider trading norm. It has now been alleged that
these accounts may have been the means of siphoning off the missing funds.

In January 2009, Raju resigned as the Chairman of Satyam after he admitted to

major financial wrong-doings. In January 2009, Raju confessed of his involvement
in inflating the profits of the company for the past couple of years. The 7,800-
crore fraud started with an initial cover-up for a poor quarterly performance and
assumed massive proportion, with time.