Satyam CEO arrested over US$1bn scandal

Satyam CEO and founder Ramalinga Raju has been arrested over his involvement in the $1 billion false accounting scandal, which has wiped out an estimated $2.2 billion of investor wealth.

New company chairman Deepak Parekh has told Bloomberg that the company may need to be broken up - and parts of the company sold off - in an attempt to stem the rapid decline in value of the company.

Separation may also be needed to shield any potential buyers from lawsuits lodged by angry investors, he said. Satyam is facing at least three class-action lawsuits in the US alone.

The board will also work to determine how much cash Satyam has on hand to fund its business operations and pay its 53,000 employees.

Meanwhile, Raju, his younger brother and Satyam CFO Srinivas Vadlamani have been remanded in custody, and face charges including forgery and criminal conspiracy. The first hearing will take place on January 23.

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