INDIA BUSINESS WORLD - JULY 2006
THE MONTH THAT WAS...

SIFY FACES BRASS EXODUS

SIFY is staring at a management crisis with top brass set for sudden exit. Sources said managing director and CEO R Ramaraj and a group of top honchos have put in their papers amidst talks about growing strife with new promoter, US-based private equity firm, Infinity Capital Ventures.

As many as 20-25 top executives could be on their way out. Incidentally, the move comes barely 24 hours ahead of Sify's first quarter results and an investor conference to be addressed by Mr Ramaraj.

Sources claimed there is no new management team in sight as of now, leading to operational uncertainty. When contacted, a Sify spokesperson denied the developments. However, sources said some of the top brass would be accorded a ceremonious farewell as early as July 18.

Others tipped to leave with Mr Ramaraj include chief HR officer Ajit Abraham and chief technology officer Rustom Irani. Another honcho, Ajay Nambiar, who headed consumer channels, had quit last week.

Over last few months, the industry grapevine had hinted at trouble brewing between the management led by Mr Ramaraj and Infinity Capital boss Raju Vegesna.

 Infinity Capital holds majority stake in Sify after it bought the entire shareholding of Satyam Computer Services, and part stakes of Venture Tech and Softbank Asia Infrastructure Fund (SAIF) in November. Infinity paid almost $63 million for Satyam's remaining 31% odd as part of the transaction.

Satyam floated Sify (formerly SatyamOnline) in 1997-98 with Mr Ramaraj at helm. It made aggressive moves, including a jaw-dropping Rs 499-crore acquisition of India World, during the dotcom boom of the late 90s. Satyam pressed the exit button over a period of time as the subsidiary continued to be a cash burner.