The fragile truce between the two co-founders of InterGlobe Aviation Ltd, which operates budget Indian airline IndiGo, appears to be all but broken. This is evidenced by the fact that co-founder Rahul Bhatia and his IGE Group has submitted an arbitration request against his partner Rakesh Gangwal before the London Court of International Arbitration (LCIA) on issues of compliance with the shareholders’ agreement and articles of association in the company.
The Economic Times reported that the agreement and related articles of association, have been the cause of a bitter and very public dispute between Bhatia and Gangwal who both developed Indigo
into India’s biggest airline controlling nearly half of the domestic market. The shareholders’ agreement signed in April 2015 expires shortly.
Gangwal and his associates hold nearly 37% in InterGlobe Aviation, while IGE group owns around 38%. Although the two groups own similar stakes, an initial agreement gave special rights to Bhatia’s company.
No financial claims included
In July, Gangwal had among other things complained to the Securities and Exchange Board of India (SEBI) that the agreement is skewed towards Bhatia in that it gives him the power to choose and appointment the chairman, most board directors and the top management executives.
Following the filing, Indigo said in a statement that the request for arbitration did not include monetary claims, including any compensation or penalty and neither did it elaborate on details of its contention.
Nol van Fenema
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