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Last Updated : May 16, 2019 03:24 PM IST | Source: Moneycontrol.com

IndiGo plummets 9% after reports of rift between founders; CEO offers clarification

The airline has since quashed the report calling it mere speculation.

Moneycontrol News @moneycontrolcom

Shares of Interglobe Aviation plummeted almost 9 percent on May 16 after reports of an alleged rift between the promoters of IndiGo made rounds.

According to multiple media outlets, the founders of the budget carrier— Rahul Bhatia and Rakesh Gangwal — locked horns over strategies and ambitions for the airline.

The two founders, who are allegedly grappling over the managerial control of IndiGo, have approached different law firms, reports suggest.

The reports claim that Bhatia feels Gangwal is trying to gain control of the airline by bringing his own team.

The first seed of dissension between the two founders was reportedly sown when IndiGo's former CEO Aditya Ghosh left the airline in April 2018 and the consequent appointment of expatriates in management positions.

A number of the expatriate executives at IndiGo, the source said, “were handpicked by Gangwal from his former employer — United Airlines," reported The Indian Express.

In a mail to staff, CEO Ronojoy Dutta offered clarification saying the growth strategy of the airline remains fully in place and the company board has assigned the management to implement it.

"I am sure that you are all aware of the press reports regarding alleged disagreements between our two promoters Mr Rahul Bhatia and Mr Rakesh Gangwal. I want to assure you that the growth strategy of the airline remains unchanged and firmly in place, and the management is fully charged by the board to implement it. We will continue our focus on creating value for all our shareholders, our customers, our employees and the communities we serve," Dutta said.

At 1521 hrs, Interglobe Aviation was quoting Rs 1,470, down 8.61 percent on the BSE.
First Published on May 16, 2019 11:22 am
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