IndiGo's co-founders Rahul Bhatia and Rakesh Gangwal stand divided over management control and appointment of key executives, and have approached law firms to settle the discord.
IndiGo’s co-founders Rahul Bhatia and Rakesh Gangwal stand divided over management control and appointment of key executives, and have approached law firms to settle the discord, The Indian Express wrote citing sources. Rahul Bhatia and Rakesh Gangwal did not respond to the queries sent by The Indian Express. Gangwal and Bhatia together held a 99% stake in the airline at the time of its listing in 2013. As of now, Rahul Bhatia holds 38% stake in the parent company of IndiGo — Interglobe Aviation — and Gangwal has 37% share in the company. The airline was co-founded by the duo in 2006.
What’s brewing at IndiGo?
Bhatia and Gangwal have been in conflict since the exit of airline’s CEO Aditya Ghosh in April 2018, according to The Indian Express sources. Furthermore, the appointment of “expatriates in management positions”, who were majorly handpicked by Gangwal from United Airlines (his former employer), also resulted in the tensions, sources said. The CEO post after Aditya Ghosh was taken over by Ronojoy Dutta, a former president at United Airlines. However, IndiGo had shortlisted Gregory Taylor for the position and Rahul Bhatia took charge as interim chief of the airline.
Meanwhile, many other expatriates also joined IndiGo including Wolfgang Prock-Schauer as the chief operating officer and Willy Boulter as chief strategy officer. The top management positions are in the reigns of Ronojoy Dutta as the CEO, and Rohit Philip as the CFO. Both are former United Airlines employees.
IndiGo recorded a 75% fall in its net profit for the Oct-Dec quarter of FY19 to a little over Rs 190 crore. The same is understood to be among the reasons of the Gangwal, Bhatia rift, The Indian Express said. Major airlines in India have been reporting lower profits, and some even overall loss, pertaining to high ATF prices and the cut-throat competition among the airlines, which forced them to keep the airfares low. IndiGo has also attributed its losses to the same along with the currency depreciation during the quarter.