Who will captain IndiGo Airlines? After a brief hiatus, the rift between the two promoters of the airline has resurfaced. On Tuesday, Rakesh Gangwal, co-promoter of the budget carrier, said the rift over control continues in a letter to SEBI and ministry of corporate affairs. The warring promoter duo had reached an agreement to include inducting four new directors on the board of InterGlobe Aviation (IGA), on July 20.
Though Gangwal had agreed to the arrangement arrived by both the parties in their last meet, this time, he has alleged that adding new directors will only end up giving more control to Rahul Bhatia’s InterGlobe Enterprise. Earlier, in another letter on July 9, Gangwal had alleged that Bhatia’s InterGlobe Enterprise (IGE), holding 38 per cent share, decides on appointments of all major posts in the airline including chairman, managing director and CEOs.
Gangwal had questioned why a minority shareholder was allowed to decide on all major appointments? In his earlier letter, he had also alleged that IGE was entering into related party transactions with the airline by forming various companies. The IndiGo co-founder had said that corporate governance in India’s largest airline was akin to ‘paan ki dukan’. These apprehensions, including that of Bhatia exercising more control over the airline, were refuted in another letter to SEBI by Indigo Airline chairman M. Damodaran.
Earlier on July 20, the two co-founders had agreed that they will induct four new directors, including a woman director, on their board. They also decided that all related party transactions over Rs 2 crore would now require the approval of the board.
In his recent letter, Gangwal had told market regulators that he won’t sign on the restructuring changes of the NSE and BSE listed IGA until a ‘large loophole’ is looked into.
06/08/19 Soumik Dey/The Week
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Though Gangwal had agreed to the arrangement arrived by both the parties in their last meet, this time, he has alleged that adding new directors will only end up giving more control to Rahul Bhatia’s InterGlobe Enterprise. Earlier, in another letter on July 9, Gangwal had alleged that Bhatia’s InterGlobe Enterprise (IGE), holding 38 per cent share, decides on appointments of all major posts in the airline including chairman, managing director and CEOs.
Gangwal had questioned why a minority shareholder was allowed to decide on all major appointments? In his earlier letter, he had also alleged that IGE was entering into related party transactions with the airline by forming various companies. The IndiGo co-founder had said that corporate governance in India’s largest airline was akin to ‘paan ki dukan’. These apprehensions, including that of Bhatia exercising more control over the airline, were refuted in another letter to SEBI by Indigo Airline chairman M. Damodaran.
Earlier on July 20, the two co-founders had agreed that they will induct four new directors, including a woman director, on their board. They also decided that all related party transactions over Rs 2 crore would now require the approval of the board.
In his recent letter, Gangwal had told market regulators that he won’t sign on the restructuring changes of the NSE and BSE listed IGA until a ‘large loophole’ is looked into.
06/08/19 Soumik Dey/The Week
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