In an email written to Indigo employees on September 2, CEO Ronojoy Dutta expressed relief that the feud between Indigo promoters Rahul Bhatia and Rakesh Gangwal had ended.
In a report published in The Times of India, Dutta's email is quoted saying, “As you know, there were a couple of contentious issues between our two promoters which needed to be addressed. The first related to the issue of related party transactions (RPT) and the second related to the size and composition of the new board as we induct some independent directors.”
Reportedly, the issue was resolved at the Annual General Meeting held on August 27, which was followed by a subsequent board meeting on August 30.
Dutta began his email asking that employees can now take “deep yoga breaths”, adding later that the issue had now been “satisfactorily sorted out” and that procedural changes had been made to the RPT policy with the revised policy approved unanimously by the board. In addition, the board would be expanded to 10 members with four of its directors independent.
Gangwal and Bhatia are the two co-founders of IndiGo Airlines, with Gangwal and his family owning a roughly 37 per cent share in InterGlobe Aviation (IndiGo’s parent company)while Bhatia and family own nearly 38 per cent of shares in IndiGo.
The dispute between the two has raged since July. This is not the first time that the company has claimed to have resolved the dispute—In August, Dutta refuted claims that a truce had been made, warning that he would not add his vote for a resolution to expand the board’s size if it led to more power being allocated to Bhatia’s IGE group. The proposal to have four independent directors was floated on July 20. The board, earlier, had six members including Bhatia and Gangwal.
The feud between the IndiGo co-promoters came into the public domain after Gangwal wrote to market regulator Sebi in July and sought its intervention to address the alleged corporate governance lapses at the company, charges that have been rejected by the Bhatia group.
Dutta's email added that IndiGo would add 41 international flights this year, and that the "emotional impediment" had been removed, with "expansive growth into new horizons" to continue at high speed.
