Satyam loses Coke, GlaxoSmithKline deals too

Coke project to CapGemini
GlaxoSmithKline project to Cognizant

Satyam’s prized possessions, both clients and employees, are slowly slipping away. Coca-Cola and GlaxoSmithKline (GSK) are the latest to exit the company. While Capgemini has already bagged the $100-million seven-year Coca-Cola project, it is learnt that Cognizant will get the $35-million GSK contract.

Coca-Cola and Satyam refused to comment on the development, but Capgemini confirmed that it has bagged the order. On the other hand, both Cognizant and GSK said they do not comment on individual contracts. A few key employees who were critical to the implementation of the Coca-Cola project have quit Satyam to join Capgemini, an official at one of the companies told ET.

“Coca-Cola Enterprises has selected Capgemini for a seven-year arrangement to implement comprehensive finance and accounting (F&A) solutions in CCE’s North American business unit to create an efficient process in a cost-effective environment,” said a Capgemini spokesperson. However, the spokesperson refused to confirm or deny if some Satyam employees had been hired.

When companies change their software vendors, there is usually a clause in the client-vendor agreement that makes it binding on the exiting service provider to assist the new player during the transition period.

“In this case, it (enforcing the clause) wasn’t so easy due to the current circumstances, so Capgemini was asked to recruit some of the important (Satyam) employees,” said a consulting head who is advising some Satyam clients. Some Satyam employees may leave the organisation along with contracts, he said.

But there could be some legal disputes in the offing. “Most employees have a non-solicitation clause which prevents them from joining a rival company,” said Anoop Narayanan, partner law firm Majmudar & Co. “There could also be a non-competition clause, which does not permit the employees from working with any other company in the same field for a particular period of time,” Mr Narayan.