Truce finally? IndiGo promoters may bury the hatchet

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Updated: July 23, 2019 7:02:39 AM

IndiGo on Sunday said it will amend its Article of Association (AoA) for expanding its board size to 10 that includes the appointment of an independent woman director as mandated by Securities and Exchange Board of India (Sebi).

The size of the board has been a contentious issue between Gangwal and Bhatia. While Gangwal had rooted for expansion, Bhatia viewed the move as an attempt to dilute the controlling rights of his InterGlobe Enterprise.

The estranged co-promoters of IndiGo — Rakesh Gangwal and Rahul Bhatia —could be heading for a patch-up, according to indications from some of the people who attended the board meeting held last week on Friday and Saturday to take on record the April-June earnings of the company as well as some of the issues raised by Gangwal.

“Two things have happened which are significant (in the board meeting on July 20). Firstly, the resolution on the appointment of an independent woman director which was a regulatory requirement, and decision to induct two more independent directors to strengthen the functioning of the board,” a person close to Gangwal said, hinting at possible truce ahead. “The meeting was a cordial one. The issues regarding strengthening corporate governance were discussed. Things are moving in the right direction,” the person added.

IndiGo on Sunday said it will amend its Article of Association (AoA) for expanding its board size to 10 that includes the appointment of an independent woman director as mandated by Securities and Exchange Board of India (Sebi).

The AGM is expected to be held around last week of August. The size of the board has been a contentious issue between Gangwal and Bhatia. While Gangwal had rooted for expansion, Bhatia viewed the move as an attempt to dilute the controlling rights of his InterGlobe Enterprise.

Currently, the airline’s board comprises six members of which three members are nominees of Bhatia while Gangwal has one nominee member. The remaining two are independent directors. “The unusual rights available to the IGE Group in conjunction with the lack of diversity and paucity of independent directors in the Board may very well be at the root of why governance matters have taken such a back seat at IndiGo,” Gangwal had written in his letter to Sebi on July 8.

 

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