Corrected: Infosys appoints former chief Nilekani as chairman in bid to settle feud

(Corrects in para 3 to say that Ravi Venkatesan has resigned as co-chair but remains on the board)

MUMBAI (Reuters) - The board of Indian IT services company Infosys Ltd appointed former chief Nandan Nilekani as chairman on Thursday, as it sought to end a row with founder executives that prompted its CEO to step down last week.

Nilekani, one of the seven engineers who founded Infosys in 1981 and was its CEO from 2002 to 2007, will take over as non-executive chairman and non-independent director with immediate effect, the company said in a statement to stock exchanges.

Infosys said Chairman R Seshasayee, former CEO Sikka and two other members had also resigned from the board, as the company tried to resolve the situation. It said Ravi Venkatesan had also resigned as co-chair, but would remain a board member.

The appointment of Nilekani comes days after CEO Vishal Sikka resigned, saying he was unable to serve as chief executive amid a "continuous assault" by founder Narayana Murthy.

Murthy and a few former Infosys executives have for months waged a public battle against the board of Infosys, accusing it of corporate governance lapses.

Disagreements between the two sides included the rise in Sikka's compensation, the acquisition of Israeli automation firm Panaya for $200 million and a severance package offered to a former finance chief.

(Reporting by Sankalp Phartiyal; Editing by Susan Fenton)