A whistleblower has asked market regulators in India and the US to question Infosys’s decision to sell Panaya and fix the board’s accountability in the acquisition, according to a report in The Economic Times.
The whistleblower’s letter said the board of India’s second largest technology services firm needs to answer what changed Panaya from a “strategic acquisition to a completely value less one”.
Infosys on Friday said it would look for potential buyers for its units, Kallidus and Skava and Panaya. All three companies were acquired during Vishal Sikka's tenure.
Infosys will take an impairment loss of Rs 118 crore (USD 18 million) in respect of Panaya and expects the sale of the three to be completed by March 2019 and "assets amounting to Rs 2,060 crore ($316 million) and liabilities amounting to Rs 324 crore ($50 million),” it said on Friday.
Infosys bought the Israeli software firm Panaya for USD 200 million in 2015, and this deal was at the heart of a very public spat between Sikka and Infosys co-founder NR Narayana Murthy, who questioned the propriety and valuation of the deal and the corporate governance of Infosys board.
The squabble ultimately led to the exit of Sikka in August 2017.
In the letter written to the regulators, the whistleblower has alleged that the current write down of the acquisitions show that the Board has gone from having a favourable opinion of the deals to showing that “skava and panaya were dud acquisitions,” the business daily reported.According to people familiar with the contents of the letter, the whistleblower has also urged the regulator to act to protect shareholder interest and take action against those people on the board who approved the acquisitions.