Don’t see board room issues impacting performance: Hardeep Puri on IndiGo
NEW DELHI:“You don’t see the board room issues impacting the performance of the airline,” civil aviation minister Hardeep Singh Puri said on Monday over differences between promoters at IndiGo, which is the country’s largest airline.
His remarks came during a briefing about Air India disinvestment in response to a query on whether sentiments could be impacted as the sale is also happening at a time when there is a possibility of a promoter exiting IndiGo.
“I see no difficulties…,” the Minister of State for Civil Aviation said about the possible impact of IndiGo issue on Air India stake sale.
The government on Monday issued a Preliminary Information Memorandum (PIM) for 100 per cent stake sale in Air India.
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.
“IndiGo is an internal matter. They will get it resolved… it is the largest domestic carrier, it has 300 aircraft on order, you don’t see the board room issues impacting the performance of the airline,” the minister said.
Responding to the query, Civil Aviation Secretary Pradeeh Singh Kharola said the impact of IndiGo is totally an internal thing.
“If you see, this has been going on for so many months… Performance of IndiGo has not been affected. It is purely an internal matter and they are handling it,” he noted.
Against the backdrop of the feud between the promoters, InterGlobe Aviation will convene a meeting of shareholders on January 29, at the request of Gangwal, for removing various provisions in a key document of the company.
The extraordinary general meeting (EGM) would discuss deleting various Articles pertaining to transfer and acquisition of the company’s shares, including ‘Right of First Refusal’ and ‘ Tag Along Right’, in the company’s Articles of Association (AoA).
In November 2019, IndiGo CEO Ronojoy Dutta in November 2019 said there was “zero impact” on the carrier right now as they are on the same page over the airline’s strategic direction, while commenting on the differences between the promoters.
On Monday, IndiGo’s parent InterGlobe Aviation reported a steep jump in profit after tax at Rs 496 crore in the three months ended December 2019.
In the year ago period, the same stood at Rs 185.2 crore.
Source: Press Trust of India