IndiGo shareholders reject Gangwal’s bid to open door for exit
NEWDELHI: Shareholders of InterGlobe Aviation Ltd, which runs India’s largest airline IndiGo, rejected co-promoter Rakesh Gangwal’s proposal to amend the company’s articles of association (AoA), which could have provided him a clean exit if he so desired amid an escalating feud with partner Rahul Bhatia.
If the amendment was approved, it would have done away with the Bhatia-led group’s right of first refusal to buy Gangwal’s stake in case the latter decided to sell his shares.
About 51.11% of the valid votes rejected the special resolution, while 48.56% were in favour, according to a filing with stock exchanges.
For the special resolution to be approved, Gangwal and his promoter entities, which had called an extraordinary general meeting (EGM) on Wednesday, needed 75% of the votes.
Gangwal has accused co-promoter Bhatia of violating corporate governance norms, questioned related-party transactions and sought more independent directors including a woman director on the board.
Bhatia has denied the allegations.
Bhatia-controlled InterGlobe Enterprises (IGE) has maintained there is no evidence to substantiate the allegations on related-party transactions between the airline and IGE.
“The rejection of Gangwal’s proposal by shareholders indicates that the dispute between the co-promoters is likely to linger,” an analyst with a domestic brokerage said on condition of anonymity.
“The resolution does not provide clarity on whether Gangwal wants to sell his stake or not,” said Jasmeet Singh, a shareholder present at the meeting. “Also, he called the EGM but was himself absent.”
The EGM on Wednesday was filled with drama due to the absence of Gangwal, who had called the meeting.
InterGlobe Aviation and Gangwal did not respond to emailed queries until the time of going to press. Gangwal did not respond to calls on his mobile phone.
A spokesperson for Bhatia’s IGE said the company was not aware of the reasons behind Gangwal’s absence at the EGM.