New Delhi: The board of directors of InterGlobe Aviation Ltd., the company that operates the country's largest airlines IndiGo, has approved a new policy on related-party transaction (RPT), IndiGo's co-promoter Rakesh Gangwal said on Friday.
"The Board also has now approved a new related party transaction policy and to close an open issue if the Articles of Association (AoA) are amended at the upcoming August 27 AGM to increase the Board size to 10 directors," Gangwal said in a post on his website.
Gangwal had earlier questioned board chairman M. Damodaran for not adopting the agreed related-party transactions (RPTs) policy, and calling board and committee meetings after the company’s annual general meeting (AGM) slated for 27 August.
Gangwal and his associates hold nearly 37% in InterGlobe Aviation, while co-founder Rahul Bhatia’s InterGlobe Enterprises Ltd (IGE) holds around 38%. Although the two groups own roughly similar stakes, an initial agreement gave special rights to Bhatia’s IGE Group.
Gangwal has accused Bhatia of violating corporate governance norms and has sought more independent directors on the board. Bhatia has denied the allegations.
Gangwal had earlier said that he will oppose the special resolution at the AGM unless another resolution is passed by the board to prevent the IGE Group from attaining more power and until a new policy on RPT is adopted by the company.
"In light of this positive and important development, I will be supporting the proposed changes to the Articles," Gangwal said.
"While much work lies ahead, including mending some fences and the regulators completi ng their investigations on the governance issues raised with them, it is gratifying to see progress towards better governance," Gangwal added.