Indigo Airlines, which succeeded Jet as the largest private player, is caught in an ugly spat between its promoters Rahul Bhatia and Rakesh Gangwal. The long-simmering conflict reached a crescendo on July 9 when Gangwal alleged serious governance lapses by Bhatia. Gangwal has now sought stock market regulator Sebi’s intervention. Sebi, in turn, has sought a response from InterGlobe Enterprises (IGE), the parent firm of IndiGo, even as its board will seek clarification from Gangwal on his allegations at its meeting on July 19. Gangwal, along with his affiliates, holds a 37 per cent stake in InterGlobe, while Bhatia, along with his affiliates (IGE Group), owns 38 per cent. The rest is held by the public.
Gangwal has alleged the company has “started veering off” the core principles and values of governance. Even a “paan ki dukaan” would have managed matters with more grace, Gangwal said. He claimed his long friendship with Bhatia and a deep trust built over a decade made him give the latter “unusual controlling rights over IndiGo”, including the right to appoint three out of six directors, as well as the chairman, managing director and the CEO. However, Bhatia, he alleged, built “an ecosystem of other companies that would enter into dozens of related party transactions (RPTs) with IndiGo”. He has also questioned the InterGlobe board’s decision not to allow an extraordinary general meeting of shareholde