The government, which was criticized for delaying action on Satyam, Friday dissolved the earlier board.

Local police in Hyderabad also arrested on Friday B. Ramalinga Raju, formerly chairman of Satyam, and his brother B Rama Raju who was the managing director. The company's chief financial officer, Vadlamani Srinivas was arrested Saturday.

Ramalinga Raju on Wednesday resigned as chairman from Satyam, after admitting to inflating the profits of the company.

The new board will have to appoint a new chief executive officer or confirm Ram Mynampati, interim CEO at Satyam, who was earlier a business unit head at the company.

The new board will also have develop a plan to raise funds for the company. At a press conference on Thursday, Mynampati cautioned that the company's balance sheet showed liquidity problems.