Satyam Refuses to Become the Forgotten IT Services Provider

You might think it’d be easy to forget using a company who’s brazen leader had overstated assets by a $1 billion. But Satyam Computer Services, which now goes by the brand name Mahindra Satyam is working hard to make sure its current—and prospective customers—won’t. It may be succeeding.

Earlier this week, the Indian IT services provider signed a $48 million, four-year offshore contract with KMD, a Denmark-based IT and consulting provider itself.

According to an article in The Denmark Post, the contract is an extension of an earlier outsourcing deal, and will focus on the continued development of IT applications, in particular SAP applications. (Interestingly, Satyam announced in December 2009 that it has been certified by SAP as a provider of solution implementation based on the Run SAP methodology).

KMD uses SAP as its IT platform for development work, and in a prepared statement, KMD CEO Lars Monrad-Gylling said “Mahindra Satyam’s outstanding competencies in this area were a major factor in our decision to extend the contract.”

The outsourcing deal also will cover work other technologies such as mainframe applications, .Net, Java, BizTalk, WebLogic, PL/1, Sharepoint and MQ Series, according to Satyam. 

The work will be done in a development center in Bangalore, India, where Satyam employs about 4,000 professionals. Some 200 Satyam associates will work on the KMD contract, according to media reports.

This appears to be the first relatively decent-sized deal Satyam has announced since its meltdown and rebuilding. Back in 2008, Satyam Computer Services was the fourth-largest IT-services enterprise in India. But all that came to screeching halt at the beginning of 2009 when its founder, B. Ramalinga Raju, revealed that the company’s revenue and profits had been overstated for several years. The Indian government stepped in, appointed a board that decided to sell a majority stake to an investor, and in April 2009, Tech Mahindra, an outsourcing company of the Mahindra Group, was selected.

For those who are curious as to what’s happening with that brazen former Satyam chairman… he’s been in jail since January 2009. In September of last year, it was reported that he had a heart attack. Just a few days ago, on March 11, he applied to India’s Supreme Court for bail (apparently a lower court had dismissed the appeal in February). According to media reports, Raju is seeking bail on health grounds and because there is little chance he could tamper with evidence since the investigation is complete.