Satyam in danger of losing clients: Analysts

Soon after the failed Maytas acquisition bid became public, the World Bank said that it had found Satyam ineligible for direct contracts with the Bank for a period of eight years, effective from last September, on grounds of bribery, fraud and business malpractice.

The World Bank's move triggered concerns among investors that other clients, including General Electric, Nestle, ArcelorMittal, Nissan Motor Co. and Qantas Airways, might follow the Bank's move.

Already, one such client, Applied Materials, which awarded a $200 million five-year contract last year to Satyam for managing the semiconductor firm's software application and maintenance work, has expressed concerns over the recent events and, though it is not exploring any immediate termination of the contract, is reportedly trying to restructure the agreement.

Global audit and tax advisory firm PricewaterhouseCoopers (PwC) is also planning to review its "continuance" with the beleaguered technology outsourcer. A source close to the development said PwC, which has been the statutory auditor for the software services firm for at least six years is seeking to re-evaluate its relationship with Satyam as the Maytas deal has cast a doubt on its corporate governance and increased its reputation risk.

Last month, UK-based mobile and online payments firm Upaid Systems Ltd., which is an old client of Satyam, also filed a motion in Texas district court, alleging that Satyam had devised a plan designed to deplete its assets and divert resources out of the company before a judgment is passed on its $1 billion lawsuit against the tech firm after the latter falsely leveled charges of fraud, forgery and breach of contract against its client.