India Says No Satyam Bailout

India Says No Satyam Bailout

India's government is not considering bailing out Satyam Computer Services, and the fraud-hit outsourcing firm may have to turn to banks, many of them state-run, if it needs funding.

Satyam shares slumped by a third on Thursday after Kiran Karnik, one of the three new Satyam board members appointed by the government, ruled out accepting government money as this would send the wrong signal.



The software services exporter has been battling for survival since founder Ramalinga Raju resigned as chairman last week, saying profits had been falsified for years and $1 billion of cash and bank balances did not exist.

"The government at this stage is not looking at any direct support or bailout to the company," Economic Affairs Secretary Ashok Chawla told reporters.