Nortel Files for Bankruptcy Protection!

15 01 2009

In another incident of the worsening global recession Nortel Networks Corp, North America’s biggest maker of telephone equipment, filed for bankruptcy protection in Wilmington, Delaware, amid the global credit crunch and declining sales.

Nortel, based in Toronto, had more than $1 billion in assets and debt, according to today’s Chapter 11 filing of its US subsidiary. The company said that several Canadian affiliates will also seek court protection.

Canadian investor Gavin Graham recalls the time when Nortel Networks Corp. was so big, with a market value of almost $250 billion, that fund managers had to own shares just to keep up with the benchmark index.

“You were pilloried if you didn’t own the stock,” said Graham, who helps oversee more than $30 billion as director of investments at Bank of Montreal Asset Management in Toronto. “Nowadays, I try not to embarrass people by asking who still owns Nortel.”

Nortel, North America’s biggest maker of telephone equipment, in business for 113 years, filed for bankruptcy protection today, capping one of the greatest corporate collapses in Canadian history. The stock fell 69 percent to 12 cents by 4:15 p.m. in trading today on the Toronto Stock Exchange, for a market value of C$60 million ($48 million).

At its peak in 2000, Nortel had annual revenue of $28 billion and employed about 93,000 people in more than 150 countries. The stock traded as high as C$1,245, adjusting for stock splits, for a market value of C$366 billion, making it the biggest company in Canada. The shares quadrupled in 1999 on expectations the Toronto-based phone equipment maker would benefit from the surge in demand for Internet-based technology.

Nortel accounted for 37 percent of the Toronto Stock Exchange 300 Composite Index, as it was called then. That created a problem for Canadian mutual fund managers, since Canadian law bars mutual funds from holding more than 10 percent of assets in any one stock.

Source:  Bloomberg

See also a timeline of events in the company here.

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Satyam Chief Ramalinga Raju Resigns

7 01 2009

Chairman of Satyam Computer Ramalinga Raju has resigned from the company’s board. In a shocking disclosure, he has revealed some financial irregularities in the company, including an inflated cash balance of Rs 5,040 crore.

In reaction to Raju’s revelations, the stock was hammered by investors and it is down over 60 per cent.

Raju said that he feared takeover due to poor finance performance. Coming clean on financial irregularities, he said that the company had Rs 1,230 crore worth of understated liability as of September 30.

Raju also revealed that he tried to fill fictitious assets with Maytas deal.

Source: NDTV

Here are some excerpts from his letter to SEBI:

“The Balance Sheet carries as of September 30, 2008

a. Inflated (non-existent) cash and bank balances of 50.40 billion rupees ($1.04 billion) (as against 53.61 billion reflected in the books).

b. An accrued interest of 3.76 billion rupees which is non-existent.

c. An understated liability of 12.30 billion rupees on account of funds arranged by me.

d. An overstated debtors position of 4.90 billion rupees (as against 26.51 billion reflected in the books)”

“The aborted Maytas acquisition deal was the last attempt to fill the fictitious assets with real ones. Maytas’ investors were convinced that this is a good divestment opportunity and a strategic fit. Once Satyam’s problem was solved, it was hoped that Maytas’ payments can be delayed. But that was not to be. “

“neither me, nor the Managing Director took even one rupee/dollar from the company and have not benefitted in financial terms on account of the inflated results.”

Read the complete letter here:  Reuters

Here is the complete timeline of events.

As of this moment Satyam Shares crashed 71% to Rs 51 on the BSE.

 

 





Happy New Year!

7 01 2009

Happy New Year everyone…its 2009 btw in case you are still hungover!

First off, apologies are in order. I haven’t updated my blog in what seems like ages and truthfully it’s not that I have been lazy.. its just that I have been taking a much needed break from my computer, my work, my routine… not that blogging is a routine but booting up a PC does seem like one!

But now I am back to the grind, the work, the traffic, the mess, the chaos… so rest assured all my frustrations will be manifested pretty regularly in this blog…apart from the other stuff of course.

Thanks to all my readers who have read my blog so far, I hope you keep coming back and bring more people with you…I ll do my best to keep this as random as possible.

So what have I been upto..as I said I was on vacation but while I was on this much needed hiatus…I have noticed that a lot of new events have taken place, but yet little has changed.

No new headway with Pakistan despite the world (except China & Brazil) being on our side, security is still bad despite the recent bombings in Assam, Chidambaram is our new Home Minister but yet you do feel the same vulnerability;  Traffic is bad everywhere despite new flyovers; pollution has gotten worse despite stricter regulatory norms in place, economy is still bad despite BPO’s hiring sprees; sport still struggles in India despite new impetus provided by our boxing and shooting stars…

the same things get repeated all over again…things move so slowly and it frustrates me…the common man!

I need visionaries, i need people to inspire me, I need someone to look up to in my country…I need hope!

While I may sound pessimistic about things.. I do however keep myself happy by enjoying the the little things …

Watching India beat England for example…or SA beating AUS.. A good book (Arvind Adiga’s – White tiger…which I promise Ill review in my future posts)…Formula 1, Driving on a well laid road (which is a rarity in most cities), a bag of potato chips, drinking beer, watching House MD or Big Bang Theory…

ahh the simple things…

So with this lack of contribution of mine to my country Id like to propose the following poll..

No matter what your answers are…have a great 360 odd days ahead!





Sony cuts 8000 jobs!

9 12 2008

In what seems like another Japanese company in trouble, citing falling revenues and stronger yen, Sony Corporation plans to cut 8000 jobs. This results in them reducing their investment by 30 % in the electronics business by the fiscal end of 2010.

Sony has about 160,00 employees as of now and aims to save upwards of 100 billion yen (roughly $ 1.1 billion) by such measures which also include shutting down manufacturing plants.

This news comes after the surprise pullout of Honda from F1 citing the same reasons which was unexpected given the reaction of the FIA.

Wipro in India is also cutting costs by recruting engineers for it’s BPO division instead of the engineering division. Although the company says it will ensure that these jobs will count as valid work experience for an engineering role in the future, the situation remain bleak for the company. In a related story on IBN the BPO companies are themselves looking for a bailout from the government. According to NASSCOM the Indian BPO sector employs roughly 700,000 people. Due to the current recession, cuts of about 250,000 jobs starting 2009 is expected. Thats a whopping 35% reduction in number of employees.

Some experts suggest this recession might last for 10 years!

All I can say is that stick on to your job, cause it just got more valuable.

Do let me know how the recession is affecting you..wherever you are.





Formula 1 – A distant Dream..

8 12 2008

The news is abuzz as far F1 is concerned.  Honda pulls out of the sport citing recession and increasing costs. Their spending increased about 30% from last year with a total of approximately $ 300 million. Sad news indeed…but thats the state of the economy now. Even big companies like Honda can’t survive the bad times.

However that’s not why I have written this post. What I wanted to share was this..

The Spa Exit

The Spa Exit

This is probably the closest I will get to a Formula 1 track..

We were on our way to Luxemborg from Netherlands and we passed the Belgian Grandprix Circuit exit on the freeway…and I thought someday Ill be take that exit and watch a race in person.

but right now it remains..but a distant dream..

But all was not lost…Luxemborg is a beautiful place and a must see stop for poeple travelling in Europe. Here is a picture taken by Tilak who was travelling with us.

What a view!

What a view!

It sums up the place quite nicely I think.





Slumdog Millionaire gets Pre Oscar!

8 12 2008

This movie should be a must watch for all.

Director Danny Boyle’s ‘Slumdog Millionaire’ was named best film of 2008 by the National Board of Review on Thursday in the first major award of the Oscar season.

Following the likes of indie films like ‘Juno’ and ‘Little Miss Sunshine’, the board’s picks are usually considered as an indicator to the Academy Awards in February.

Having scooped up ‘Best British Independent Film’, ‘Best Director’ and actor Dev Patel as ‘Most Promising Newcomer of the Year’ at the British Independent Film Awards on 30 November, the film grossed over US$3.7 million in the United States alone.

The strengths of ‘Slumdog Millionaire’ lie in its vivid cinematography, upbeat soundtrack and large cast of local talent.

“Slumdog Millionaire, with brilliant direction by Danny Boyle and incredible performances, shares a passionate story about one man’s courage and determination for the woman he loves,” said Annie Schulhof, the board’s president.

Based on the bestselling novel ‘Q&A’ by Vikas Swarup, the film tells the tale of a poor boy in India who gets a shot at winning millions on television game show “Who Wants To Be A Millionaire” as he tried to reunite with his lost love.
Source: ChannelNewsAsia

Here is the IMDB Synopsis for the film:

“The story of Jamal Malik (Patel), an 18 year-old orphan from the slums of Mumbai, who is about to experience the biggest day of his life. With the whole nation watching, he is just one question away from winning a staggering 20 million rupees on India’s “Who Wants To Be A Millionaire?” But when the show breaks for the night, police arrest him on suspicion of cheating; how could a street kid know so much? Desperate to prove his innocence, Jamal tells the story of his life in the slum where he and his brother grew up, of their adventures together on the road, of vicious encounters with local gangs, and of Latika (Pinto), the girl he loved and lost. Each chapter of his story reveals the key to the answer to one of the game show’s questions. Each chapter of Jamal’s increasingly layered story reveals where he learned the answers to the show’s seemingly impossible quizzes. But one question remains a mystery: what is this young man with no apparent desire for riches really doing on the game show? When the new day dawns and Jamal returns to answer the final question, the Inspector and sixty million viewers are about to find out. At the heart of its exuberant storytelling lies the intriguing question of how anyone comes to know the things they know about life and love.”





How Barkha Dutt Helped the Terrorists

8 12 2008

Barkha Dutt who some say was India’s answer to Christiane Amanpour  (although Christiane is way ahead) sadly lost her composure and along with it a sense of ethical journalism. A lot of blogs out there have criticized her for her shoddy reporting. But below is an extract of the India’s Chief Admiral’s public assault on NDTV and more specifically Barkha Dutt. Read on…

“Navy chief Admiral Sureesh Mehta on Tuesday mounted a frontal assault on the sections of the electronic media for its reckless coverage of the Mumbai attacks. In his annual press conference ahead of Navy Day on December 4, Mehta said the manner in which TV channels reported India’s worst terror strike had “tactical implications” and might have worked to the advantage of the terrorists.

“When operations were taking place, the channels were reporting that commandos were being airdropped. The terrorists were in live contact with their masters, who were keeping them informed. Such minute-by-minute coverage can be detrimental to conduct of operations. We are disturbed by such reporting.” Mehta picked holes in the coverage of the 1999 Kargil war to prove that channels have traditionally not exercised restraint in their coverage of events that have a bearing on national security.

Singling out a lady journalist from the English news channel NDTV, Mehta, who is also the chairman of chiefs of staff committee, said irresponsible coverage of the war had compromised the safety of troops and led to the death of three soldiers. He said this particular journalist had cajoled an army colonel to demonstrate the firing of an artillery gun to capture a great shot on the camera. He said the colonel was later dismissed from service.

Prannoy Roy, president, NDTV, told HT: “What he said is completely untrue and malicious. We have asked for a retraction and a public apology as this amounts to defamation.” New Delhi Television is owned by Radhika Roy who is the sister of CPI-M leader and pro-China voice Brinda Karat. CPI-M party was the only political party that had openly supported China in the 1962 war with India ansd till date has not issued an apology.

General V.P. Malik (retd), who was the army chief during the Kargil war, in his memoirs Kargil — From Surprise to Victory, had written in his book that after the war was over, he mentioned to Barkha Dutt that she had let out classified information in her “professional enthusiasm” by pointing out that the army’s next objective would be Tiger Hill.”

Source: http://www.newspostindia.com/report-61105

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Wikipedia has a controversy section of her which details her exploits during her coverage of Kargil:

http://en.wikipedia.org/wiki/Barkha_Dutt#Controversies

Here is another take on her bad reporting:

http://openspace.org.in/node/811

Please let us get this woman off the air!!