Centre to take over Maytas firms

February 18th, 2009
Feb. 17: The Centre, in a dramatic move, on Tuesday decided to take over Maytas Infra and Matyas Properties run by the sons of Mr B. Ramalinga Raju, the disgraced former chairman of Satyam Computers.

“We have moved the Company Law Board to remove the existing directors of these companies and to declare them as ineligible for appointment as directors in any other company,” said the corporate affairs minister, Mr Prem Chand Gupta.

The Centre has moved swiftly to take over the fir-ms after getting wind of a major scam brewing there. “We find a strong possibility that the affairs of Maytas Infra and Maytas Properties have been conducted by its present management with fraudulent intent and breach of trust to the stakeholders of the company,” said the minister, justifying the takeover.

He added that the persistent neglect of the board had badly affected of the business and operations of these two companies. “We needed some information to act,” he said, explaining the delay in the Centre’s action.

Mr Raju’s elder son, Mr Teja Raju, runs Maytas Infra while younger son, Mr Rama Raju Jr, manages Maytas Properties. The government now plans to nominate its own directors on the board and take over their reins.

At present, Maytas Infra has three directors — Mr B. Teja Raju, Dr R.P. Raju and B. Narasimha Rao — while three others, including chairman, Mr R.C. Sinha, Mr C.S. Bansal and Mr P.K. Madhav, quit last month.

Maytas Properties, which is a privately held company of the Raju family, has three directors — Mr B. Ramaraju, Mr B. Tejaraju and Mr Datla Gopala Krishnam Raju. The government has also asked CLB to prevent the directors of these two companies from selling or mortgaging assets owned or controlled by them without permission. The CLB will hear the government’s petition on February 24.

Maytas Infra, along with a few joint venture partners, is executing around 93 projects worth Rs 40,000-crore across India especially AP, Maharas-htra, Karnataka and Orissa.