Australian telecom services provider Telstra is understood to have terminated its IT outsourcing contract with Satyam [ Get Quote ]. The contract is believed to be worth $32 million (around Rs 1.6 billion) a year.

Media reports in Australia [ Images ] say the contract has now been awarded to EDS (part of IT major Hewlett-Packard [ Images ]). It is also understood that Satyam's new chief executive, A S Murty, had rushed to Australia last week in a last-ditch effort to retain the contract, which accounted for about 35 per cent of Satyam's revenue from Australia.

A Satyam spokesperson said, "We don't comment on individual clients."

For the past two months, ever since the news of fudging of accounts by the company's erstwhile chairman, Ramalinga Raju [ Images ], came to light, the beleaguered Satyam has been struggling to retain clients.

While industry sources say six-seven clients have cancelled their contracts, Satyam has confirmed that only the US-based State Farm Insurance Co has terminated the contract with the company.

Reports say the United Nations has also decided to snap a direct contract with the company.