InterGlobe Aviation Ltd.’s co-founder Rakesh Gangwal quit the carrier’s board and will pare his stake in the company over five years, ceding control to co-promoter Rahul Bhatia after a truce.
Gangwal has resigned as non-executive, non-independent director of InterGlobe Aviation, the parent of India’s largest carrier IndiGo with immediate effect, according to his letter to the board filed with the exchanges.
His “intention” is to gradually reduce stake in InterGlobe over five-plus years, according to the letter. “I have been a long-term shareholder in the company for more than 15 years and it’s only natural to someday think about diversifying one’s holding.”
Gangwal’s exit from the board marks an end to a feud between the the two co-founders over governance and related-party deals. It comes a little over a month after shareholders of InterGlobe Aviation voted to remove curbs on sale of shares by co-promoters. And Bhatia is taking over a newly created executive role of managing director at the company.
While new investors would benefit from his reduction in stake, Gangwal said in his letter to the board, it will also allow him to benefit from some of the upside.
To avoid his exposure to any unpublished price-sensitive information, Gangwal said he decided to step down from the board. Gangwal, however, said sometime in the future, he might consider participating again as board member.
