January 7, 2009

European investors unfazed by “India’s Enron” in IT

According to Reuters: “European investors remain upbeat about India despite an accounting scandal at IT company Satyam Computer Services (SATY.BO) that sent Indian markets tumbling on Wednesday.

Shares in the IT group fell almost 80 percent after founder and chairman Ramalinga Raju admitted inflating the company’s reported cash and bank balances by over 50 billion rupees ($1 billion).

While shaken by what has been dubbed “India’s Enron”, some investors say they will wait for signs of widespread malfeasance among Indian companies before deciding whether to change their investment policy on India.”

  • Satyam is the fourth largest of the Indian IT outsourcing firms
  • Satyam serves more than a third of the Fortune 500 companies
  • Satyam’s clients include multinationals such as Nestl√©, General Motors (GM), and General Electric (GE)
  • Satyam’s auditor is PricewaterhouseCoopers, who endorsed the company’s accounts

Update: Ramalingam Raju, the chairman of troubled Indian IT outsourcing company Satyam Computer Services, resigned on Jan. 7, 2009, admitting the firm had falsified accounts and assets and inflated its profits over several years.

January 5, 2009

The biggest CEO firings of 2008

The biggest names to be shown the door as a result of the economic crisis:

  • Martin Sullivan of American International Group (let go in June)
  • Kerry Killinger at Washington Mutual (September)
  • Richard Fuld of Lehman Brothers (leaving next month)

“Their distinguished company includes James Cayne of the now-deceased Bear Stearns and Richard Syron and Daniel Mudd, the former CEOs of the mortgage buyers Freddie Mac and Fannie Mae.”,¬† according to Forbes and MSNBC

“There are two kinds of CEO firings,” says Noel Tichy, a professor at the Ross School of Business at the University of Michigan. “There are the crooks and there are the incompetents.” This year the biggest departing names all fell into a gray area in between.”

Source: Forbes, MSNBC

December 18, 2008

Omnicom to Cut Up to 3500 Jobs

Filed under: finance,Investment — 7macaw @ 7:53 am
Tags: ,

According to AdAge, Omnicom Group – the industry’s largest holding company – is preparing a massive layoff of nearly 5% of its global work force of 70,000, according to executives close to the situation.

It is also reported that the executives would not confirm which divisions or agencies would be affected by the estimated 3,500 job loss, but it is believed that BBDO, the agency for ailing Chrysler, which lost its flagship U.S. brand Pepsi business this year, would particularly feel the ax. Earlier today, Ad Age reported that Omnicom media agency PHD was laying off 30 people and closing its Atlanta office.

December 15, 2008

Northern Trust to cut about 450 jobs

Filed under: banking,Investment,US — DF @ 11:34 am
Tags: ,

According to Reuters: “Northern Trust Corp will cut about 450 jobs, or 3.7 percent of its work force, the U.S. trust bank and asset manager said on Monday, joining its rivals in shrinking staff due to tough market and economic conditions.”

December 5, 2008

Legg Mason to Cut 8%, or 200 Jobs, as Assets Fall

According to Bloomberg: “Legg Mason Inc., the Baltimore-based fund manager that has lost three-quarters of its market value this year, will cut about 200 jobs, or 8 percent of its workforce, as it seeks to lower annual expenses by $120 million.”

“U.S. money managers have eliminated more than 4,200 jobs in the past two months in response to the worst stock-market declines since the Great Depression. Fidelity Investments is dismissing 3,000 people, or 7 percent of its workforce, while BlackRock Inc. is cutting an undisclosed number of jobs.”

December 3, 2008

State Street to cut up to 1,800 jobs

According to AP: “State Street Corp. on Wednesday said it will cut 1,600 to 1,800 jobs, or 6 percent of its global work force, between now and the end of the 2009 first quarter, in an effort to reduce operating costs.

The investment services company will reduce its staff mostly by consolidating middle and senior management ranks, it said after the market closed. Most of the cuts will be in North America, with the rest in Europe and the Asia-Pacific region.”

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