IndiGo today held its 16th annual general meeting in Delhi. The meeting was bound to be an important one as the company was interacting with its shareholders for the first time after the differences between the two promoters, Rakesh Gangwal and Rahul Bhatia, came to the fore. Let us look at the 10 key takeaways from the AGM.
In the midst of a fallout and then some signs of truce between the two promoters, Rakesh Gangwal and Rahul Bhatia, it was not a well-attended annual general meeting with around 50-60 people showing up. While the shareholders hoped to seek answers from the two promoters regarding the differences, Gangwal, who traditionally has not been taking part in these annual meetings, chose not to attend this year as well. A senior executive later added that he did not inform the board about his absence at the AGM.
Dr Anupam Khanna, an independent director at IndiGo board, also did not attend the AGM. Dr Khanna is a college senior of Gangwal and also heads the nomination and remuneration committee at the airline. It is important to note here that Gangwal and Dr Khanna had raised concerns about lack of corporate governance and questioned related-party transactions taking place between IndiGo and InterGlobe Enterprises of Rahul Bhatia. CEO Ronojoy Dutta and board members M. Damodaran, promoter Rahul Bhatia, Rohini Bhatia, Anil Parashar, company secretary Sanjay Gupta were among those present at the AGM on Tuesday.
IndiGo today told its shareholders at its 16th annual general meeting that all related-party transactions between the airline and promoter Rahul Bhatia’s InterGlobe Enterprises are at arm’s length and in the best interest of the company. The airline also told the shareholders that the company continues to have a robust whistleblower mechanism and added that the Chairman of the board, M. Damodaran, has not received any whistleblower complaint till now.
Two resolutions were put up for shareholders’ approval. The first one was about expanding the board size to a maximum of 10 members including four independent directors and the other is about reappointment of M Damodaran as chairman of the board for a period of five years. While official figures will be known in 48 hours several company executives said that majority votes are already in favour of these resolutions.
Rahul Bhatia, who initially maintained silence on shareholders’ queries regarding conspicuous absence of Gangwal and Dr Khanna, on being asked repeatedly, told the shareholders that “it is for them (Gangwal and Dr Khanna) to answer” but smiled a bit and added, “ Mai hoo na.” A shareholder also asked the two promoters, Rakesh Gangwal and Rahul Bhatia, to go for a two-day trip and not talk about business at all during the vacation.
In a response to a query regarding if not Gangwal then who will handle negotiations with OEMs, CEO Ronojoy Dutta informed the shareholders that Mr. Riyaz Peer Mohamed, Chief Aircraft Acquisition and Financing Officer, who led the negotiations with CFM in the engine deal for 280 Airbus A320 family aircraft, will handle the negotiations for narrow-body and wide-body aircraft going ahead.
The company reiterated that it continues to study the wide-body model but currently, it is assessing whether it should induct A321 XLR family of aircraft to reach expand its network and reach destinatons like London. All discussions remain in preliminary stage.
Rahul Bhatia told shareholders that the latest statement from Rakesh indicates signs of truce but he hoped that “his actions will speak louder than his website.” Simultaneously, when a shareholder pointed out that Gangwal has also been an important part of the company’s success, he said “don't think there has been any public forum where I haven't acknowledged Rakesh's contributions.”
On the dispute between the two promoters, M. Damodaran said that he is an optimist and hopes that good sense will prevail as the two gentlemen (Gangwal and Bhatia) are talking.
Towards the end, Rahul Bhatia took a dig at the “paan ki dukaan” comment of Rakesh Gangwal. He said that he wanted to serve ‘paan’ to all shareholders but “over the last few days the company seems to have improved miraculously its governance standards so we disbanded the idea.”
First Published: Aug 27, 2019 8:33 PM IST