IndiGo Airlines co-promoter Rakesh Gangwal and his wife on Thursday, September 8 divested a 2.74% stake in the parent company InterGlobe Aviation for INR 2,005 crore through open market transactions. Gangwal along with Rahul Bhatia co-founded the low-cost carrier IndiGo airlines.
Gangwal resigned from the company’s board of directors in February 2022, stating that he would gradually reduce his equity stake over the next five years. Gangwal selected Citigroup, Goldman Sachs, Morgan Stanley, and JP Morgan to oversee the sale process earlier this year.
According to the bulk deal data available with the National Stock Exchange (NSE), Gangwal and his wife Shobha Gangwal sold a total of 1.05 crore shares, amounting to a 2.74% stake in the company. The shares were sold from INR 1,886.47 – INR 1,901.34 apiece, valuing the transaction at INR 2,004.77 crore.
As of the June quarter, Gangwal and his family owned a 36.61% stake in the low-cost carrier, where Gangwal and his wife held 14.6% and 8.39% stake, respectively, while the rest of the balance is held by Chinkerpoo Family Trust, shareholding data showed with the bourse.
Bhatia and his related entities own nearly 38% of InterGlobe Aviation. Currently, Gangwal’s stake is worth INR 27,900 crore, while Bhatia’s stake is worth INR 28,800 crore. Shares of Interglobe Aviation closed 1.56% lower at INR 1,946.90 on NSE.
Interglobe Aviation is engaged in the business of providing domestic and international air transport services under the name ‘Indigo’.
Despite being co-founders, Gangwal and Bhatia have had a very public spat for a few years now, dating back to 2019 when Gangwal wrote a letter to the Prime Minister’s office and market regulator SEBI, alleging “questionable related party transactions” between InterGlobe Aviation and Bhatia group firms.
While Gangwal’s primary issue was with the deals that IndiGo entered into with Bhatia-owned company, InterGlobe Enterprises (IGE) and other group entities; he also said that he had little power when it came to running the affairs of the airline.
According to agreements entered into between IndiGo (InterGlobe Aviation) and Bhatia’s IGE, Gangwal could name only one director to the airline’s board, while Bhatia could name five, and also appoint the managing director, CEO and president.
Now with Gangwal beginning to pare his stake in IndiGo, it seems like the relationship between him and his other co-founder, Bhatia, is beyond repair.