The government today disbanded the board of Satyam Computer Services and has decided to appoint 10 new nominee-directors in its place.
Satyam's board meeting planned for tomorrow now stands cancelled and the new board will meet within seven days to take a decision on a new management team.
The Satyam board was to meet in Hyderabad tomorrow to discuss the crisis in the wake of the revelations of Rs7,800 crore fraud.
Meanwhile, employees of Satyam Computer Services have refuted reports of having received emails suggesting a freeze on salaries for two months. Satyam has over 50,000 employees, and their fate is in limbo in the wake of the fiasco.
Founder B Ramalinga Raju has been summoned by market regulator SEBI tomorrow.
"The current board ceases to exist and there would not be any meeting tomorrow,'' corporate affairs minister Prem Chand Gupta said in a release, adding ''The new board will meet in the next seven days."
Announcing the decision, Government's decisive action came nearly 60 hours after the startling disclosure by Raju, presumed to have strong political friends, that put the company and its over 50,000 employees fate in limbo.
With Satyam's fall from grace, the Bombay Stock Exchange and the National Stock Exchange will replace Satyam on all major indices.
BSE will replace Satyam Computer with Sun Pharmaceutical in its benchmark index Sensex with effect from 12 January 2009 .
Satyam would also be removed from various other indices like BSE-100, BSE 200, BSE-500 and BSE Tech and BSE IT index the exchange said in a statement.
GlaxoSmithkline Pharmaceuticals would replace Satyam in the BSE 100 index, while the IT firm would be replaced by Castrol India in the BSE 200 index. Meanwhile, Cadila Healthcare has replaced Satyam Computer in the BSE-500 index.
The National Stock Exchange has removed Satyam from Nifty and various other indices like the CNX 100, S&P CNX 500, CNX IT and the CNX Services sector index.
The NSE removed Satyam from its benchmark index Nifty on Wednesday and the IT firm will be replaced by Reliance Capital with effect from 12 January 2009.
Further, Glenmark Pharmaceuticals will replace Satyam Computer Services in the CNX 100 Index, and Cairn India will replace it on the S&P CNX 500 Index.
Besides, Core Projects and Technologies will replace the troubled software services firm in the CNX IT Index, while Power Grid Corporation of India (PGCIL) will be in place of Satyam in the CNX Services Sector Index.
Meanwhile, Reliance Capital replaced Glenmark Pharmaceuticals in the CNX Nifty Junior Index.