IndiGo shareholders reject Gangwal's resolution to amend company's AoA

Shareholders of InterGlobe Aviation, the parent company of Indigo airline, on Wednesday rejected a special resolution of co-promoter Rakesh Gangwal to amend the company's Articles of Association (AoA).

Gangwal had sought removal of articles pertaining to transfer and acquisition of the company's shares, including 'Right of First Refusal' and ' Tag Along Right'.

"The Special Resolution has not been passed as the votes cast in favour (48.55 per cent) of the resolution are less than three times the number of votes cast against (51.44 per cent) the resolution," InterGlobe Aviation said in a BSE filing after the extraordinary general meeting held here on Wednesday.

Rahul Bhatia and affiliates -- InterGlobe Enterprises (IGE) Group -- has around 38 per cent stake in the company and Rakesh Gangwal and his related entities own around 36.64 per cent stake.

According to the AoA, if any member of Rahul Bhatia-led IGE Group wants to transfer shares to a third party, then the non-transferring group will have the 'Right of First Refusal' subject to certain conditions.

Similarly, the non-transferring group will also have the 'Tag Along Right' wherein it would have the option to sell some part of the shareholding.

The differences between co-founders and co-promoters -- Rakesh Gangwal and Rahul Bhatia -- came to the fore in July 2019 after Gangwal sought market regulator Sebi's intervention to address alleged corporate governance lapses at the company. In the wake of the feud, arbitration proceedings are also going overseas between the two promoters' sides.

Amid promoter spat, InterGlobe Aviation to hold shareholder meet on Jan 29

InterGlobe Aviation on Friday said a meeting of shareholders will be convened on January 29 to seek approval for certain changes in the company's articles of association.

The meeting is being convened following request by co-promoter Rakesh Gangwal and related entities who together hold 36.64 per cent stake in the company, the parent of the country's largest airline IndiGo.

The differences between co-founders and co-promoters -- Rakesh Gangwal and Rahul Bhatia -- came to the fore in July 2019 after Gangwal sought market regulator Sebi's intervention to address alleged corporate governance lapses at the company.

An extraordinary general meeting (EGM) would be held on January 29 on the request of Rakesh Gangwal Group, according to a regulatory filing.

The group comprises Rakesh Gangwal, Shobha Gangwal and The Chinkerpoo Family Trust (Trustee: Shobha Gangwal and J P Morgan Trust Company of Delaware).

The EGM would vote on changes in the articles of association (AoA). Generally, an AoA provides the regulations for operating a company.

Shares of InterGlobe Aviation rose over 3 per cent to Rs 1,376.60 in afternoon trade on the BSE.

Sebi starts investigation into governance issues at InterGlobe Aviation

The Securities and Exchange Board of India (Sebi) has initiated a preliminary enquiry into alleged corporate governance issues at InterGlobe Aviation, which operates IndiGo. According to sources in the know, the market regulator is likely to seek further details from the co-promoters of the company to ascertain the veracity of the matter.

The move comes after Indigo co-promoter Rakesh Gangwal had sought the market regulator’s intervention, alleging that the other co-promoter Rahul Bhatia had misused powers to enter into related party transactions with IndiGo. On this, the regulator will examine the disclosures made to the stock exchanges under listing regulations, according to a person privy to the development.

The market regulator has asked the company to give response to the allegations by July 19. 

“We will see whether it is about corporate governance or beyond that. Sebi will look into each of the allegations flagged and accordingly take a call,” said a source.

On controlling rights, the source said both the promoters should be knowing their vested power and control within the terms of article of association. ‘’Then why such contention? What has been the IndiGo board stand over it?’’he asked.

The regulator may ask the board about the measures being taken over the disagreement between the two promoters, it is learnt.

Also, the IndiGo board has to explain the reason of not adhering with the governance norms, which specify that listed companies should have one independent woman director on board.