Ramalinga Raju & family are said to have pledged their entire stake-holding of 8.5% in Satyam Computers to invest in the real estate of their sister (son) concern Mytas. Interestingly, Mytas is Satyam pronounced backwards.
When the going was good, lenders have happily given the money. But, the issue of pledging has been done surreptitiously, without the knowledge of the board.
When the time has come up for redeeming their pledged share-holding, they were hit by the global meltdown. The real estate prices crashed. Rajus informed the BSE that the lenders might liquidate the pledged stock.
To acquire their hold on Satyam, the Rajus wanted to merge Mytas with Satyam and the proposed move backfired.
It is likely that Institutional Investors, who own 51% of Satyam share-holding, may take over the management and appoint a new board to run the IT major, which employs upward of 50,000 employees.