India said to be working on forming new Satyam Board

NEW DELHI (Reuters) - India's government is working on choosing the directors for the new board of outsourcer Satyam Computer Services, Corporate Affairs Minister Prem Chand Gupta said on Saturday.

"We are working on the names," Gupta told reporters.

The board of Satyam, which was scheduled to meet on Saturday, was dissolved by the government on Friday, when Gupta said a new board would be constituted with 10 members, which would meet within seven days.

Satyam chairman and founder Raju resigned on Wednesday after revealing years of accounting fraud, including an admission that about $1 billion, or 94 percent of the cash and bank balances on Satyam's books at end-Spetember, did not exist. He was arrested on Friday night

On Saturday, Gupta said the government had received a letter from Lazard seeking board representation and it was being looked into to.

Television station CNBC TV18 was reporting the Lazard's lawyer had told it the company was Satyam's largest shareholder with a 7.4 percent stake, and wanted a board position.

(Reporting by C.K. Nayak; Editing by John Mair)