The Hindu Business Line : TCS bags chunk of World Bank projects serviced by Satyam

New Delhi / Mumbai / Bangalore, Jan. 13 Tata Consultancy Services (TCS) has clinched a “significant” portion of World Bank contracts that were previously serviced by Satyam Computer Services.

A World Bank spokesperson told Business Line, “TCS has been hired by the Bank as an IT service provider and it is currently doing a significant portion of the work that had been performed by Satyam. The Bank’s decision to debar Satyam was effective in September 2008 and followed a temporary suspension that took effect in February 2008.”

However, the Bank refused to divulge the size or the duration of these contracts saying they have never shared contract details to date. “It (the work mandate to TCS) has been happening over the last few months,” the spokesperson pointed out.

When contacted, TCS refused to comment on the deal citing silent period ahead of its third quarter result announcement slated for January 15.

Meanwhile, the TCS shares on Tuesday rose 2.16 per cent on the BSE, to close at Rs 522.80 a share.

Asked if Infosys Technologies too had won some World Bank business, Mr S.D. Shibulal, Chief Operating Officer of the Bangalore-based IT company, said, “We do not have any existing engagement with the World Bank.”

It may be recalled that the World Bank, last year, decided to keep Satyam off all businesses for eight years beginning September 2008. The Bank had attributed the ban to “providing improper benefits to Bank staff and failing to maintain documentation to support fees charged for its subcontractors.”

But in what came as a startling revelation just yesterday, the World Bank also disclosed that apart from Satyam, it had also barred Wipro for “providing improper benefits to Bank staff”, and Megasoft for “participating in a joint venture with Bank staff while also conducting business with the Bank.” The ban on Wipro and Megasoft is for four years each, effective from June 2007, and December 2007, respectively.

The Bank said Wipro’s offer of American Depository Shares to its staff as part of the public offering in 2000 was against its policy and it banned the vendor till 2011.

Wipro clarifies

Wipro, however, clarified that it had not done anything “wrong or unethical”. It had also stated that the measure would not have any material impact on the company (Wipro’s cumulative exposure to World Bank is said to be less than a million dollars over the past few years).

Mr Girish Paranjpe, joint-CEO of Wipro Technologies had said yesterday, “We had issued ADS to employees and clients at market price under Directed Share Program (DSP) that was approved by the Securities and Exchange Commission.”

Under Wipro’s DSP, about three World Bank officials and their families and friends had purchased 1,750 ADS for about $72,000 at the IPO price.

“All participants in the programme had signed a statement saying that their purchase did not violate any ethics or conflict of interest policies of their company,” Wipro had pointed out.