IndiGo Board Approves New Policy On Related-Party Transactions
InterGlobe Aviation Ltd. promoter Rakesh Gangwal on Friday said the company’s board has approved a new policy on related-party transactions, amid an ongoing feud with co-promoter Rahul Bhatia over governance issues.
The company is the parent of the country's largest airline IndiGo.
“While much work lies ahead, including mending some fences and the regulators completing their investigations on the governance issues raised with them, it is gratifying to see progress towards better governance,” Gangwal said in a statement.
Gangwal said the board has now approved a new related-party transaction policy and to also close an open issue if the Articles of Association are amended at the company's upcoming annual general meeting to increase the board size to 10 directors.
“In light of this positive and important development, I will be supporting the proposed changes to the Articles,” he said.
The AGM is scheduled to be held on Aug. 27. Currently, InterGlobe Aviation has six board members.
The feud between Gangwal and Bhatia came into the public after the former, in July, wrote to the Securities and Exchange Board of India seeking its intervention to address alleged corporate governance lapses at the company. The allegations have been rejected by the Bhatia group.
Gangwal and his affiliates hold around 37 percent stake in InterGlobe Aviation, while Bhatia’s group owns nearly 38 percent shareholding.
In a filing to the stock exchanges on Friday, InterGlobe Aviation said appointment of M Damodaran as an independent director for a five-year term starting from January 23, 2019, has been proposed by way of an ordinary resolution for the annual general meeting.
Damodaran, who is currently the firm’s chairman, would attain the age of 75 years during his tenure as an independent director, the filing said.
“...as a matter of abundant clarification of the legal position, the board has approved a resolution through circulation today i.e. August 23, 2019, that for continuance of directorship of Meleveetil Damodaran as an independent director of the company, beyond the age of 75 years, the company shall at an appropriate time before Damodaran attains the age of 75 years, seek the approval of shareholders by way of a special resolution,” it added.