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| Tough times ahead for IT
Last Updated: 2009-03-17 10:04:29
New Delhi: With sinking profits, eroding margins, cost-cuttings and an acquisition bid gone awry, 2008 was a year with more jeers than cheers for the country's over $50 billion IT sector, which has seen nearly a decade of uninterrupted boom.
Special: Financial crisis | Special: Global job cuts
In the year littered with economic disasters, the failed attempt of country's fourth largest software exporter Satyam Computer to botch up two family-promoted firms for $1.6 billion not only resulted in loss of face but also hit the reputation nurtured b y the Indian IT sector over the years.
Faced with shareholder's revolt and heavy criticism over corporate governance issues, Satyam withdrew the offer within hours of making the proposal. But within a space of 24 hours, the scrip lost over 30 per cent in India and was down 55 per cent in New York Stock Exchange trade.
IT employees in the firing line
As fallout, the Board size also shrank with four independent Directors resigning from the 10-Directors strong Board of the company in the wake of the fiasco.
The Satyam saga is likely to continue next year as well with the Board scheduled to meet on January 10. If Satyam made it to the headlines for a failed deal, it was HCL Technologies, the country's fifth largest software exporter next to Satyam that made the country proud by inking the largest takeover deal in the software space overseas.
Special: Financial crisis | Special: Global job cuts
HCL pipped rival country's second largest IT giant Infosysto bag UK-based SAP consulting firm Axon for $658 million. While Infosys had made a 600 pence per share offer for Axon, HCL made a counter bid of 650 pence a share to acquire the UK-based firm.
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