The battle between Rakesh Gangwal and Rahul Bhatia, the two founders of IndiGo, has erupted over accusations of falling corporate governance standards at the airline — stemming principally from related-party transactions between IndiGo and Bhatia’s IGE group.
Gangwal, the Florida-based airline executive-turned-entrepreneur, has been livid over the manner in which the IndiGo board stymied his request for an extraordinary general meeting of shareholders to discuss a raft of issues, including Bhatia’s “unusual controlling rights over IndiGo”.
But there is a lurking suspicion that Gangwal’s accusation of poor corporate governance standards may have more to do with a massive $20-billion, or Rs 140,000 crore, deal that IndiGo had signed at the Paris Air Show on June 17 with CFM International for 560 LEAP-1A engines that will be used to power 280 Airbus A320neos and A321neos that the airline has contracted to buy.
