IndiGo's co-promoter Rakesh Gangwal on Friday resigned from the board of directors of the parent company, InterGlobe Aviation Ltd., and said he would be gradually reducing his equity stake in the company over the next five years.
Mr. Gangwal and his associates own 36.61% in InterGlobe. He was a non-executive, non-independent director on the board.
"I have been a long-term shareholder in the company for more than 15 years and it's only natural to some day think about diversifying one's holdings. Accordingly, my current intention is to slowly reduce my equity stake in the company over the next five-plus years, though future events may impact my current thinking," Mr. Gangwal said in a statement that was shared by the company on the BSE's website.
He explained that he was resigning from the board as he didn't want to be privy to "unpublished price sensitive information (UPSI) at a time time he was thinking of diluting his stake.
"I am concerned about the optics of reducing my holdings even though such transaction would only be undertaken when I don't have any unpublished price sensitive information (UPSI). Regrettably, and effective immediately, I am stepping off the board," he said, while adding that he could consider participating as a board member sometime in the future.
The latest move follows the removal of clauses from the shareholder's agreement last year in December that had become a thorn in the relationship between Rakesh Gangwal and co-promoter Rahul Bhatia. IndiGo's shareholders in December voted to remove clauses from the Articles of Association that required either promoter to seek permission from the other while selling shares to a third party and also bestowed the right of first refusal on them during a stake sale.
The spat between the two promoters became public in July, 2019 when Mr. Gangwal wrote to the markets regulator SEBI seeking intervention on alleged misgovernance in the company and Mr. Bhatia's control of the airline.
