IndiGo Shares Decline Nearly 4% as 2.9% Equity Changes Hands Via Block Deal; Know Details

IndiGo Share Price: Shares of InterGlobe Aviation were trading lower on Thursday morning deals. The scrip slipped nearly 4 per cent after a 2.9 per cent stake in the budget carrier IndiGo, exchanged hands via block deal today. About 10.8 million shares were listed for sale for Rs 1,996 crore, according to NSE data. The block deal has a floor price of Rs 1,850 per share (discount of 6.4 per cent) to yesterday’s closing price), and will involve the sale of 10.8 million shares.

While buyers and sellers were not immediately known, CNBC TV-18 had earlier reported that global financial services major Morgan Stanley is likely to sell a 2.8 per cent stake held by the Rakesh Gangwal family in the country’s largest carrier IndiGo via a block deal, quoting sources.

Gangwal and his family own a 36.61 per cent stake in InterGlobe Aviation, the parent company of Indigo. Co-Founder and Managing Director Rahul Bhatia and his family own about 37.8 per cent.

Back in February, IndiGo Co-Founder Gangwal resigned from the board, planning to cut his stake in the airline over the next five years. “My current intention is to slowly reduce my equity stake in the company over the next five-plus years,” Gangwal said in a statement filed with the exchanges earlier this year.

Gangwal justified his resignation from the board of directors by saying it is to avoid conflict of interest since he also plans to sell his stake in the company gradually over the next five or so years. However, he has given himself an out saying that he could become a director once again in the future.

He and Bhatia had engaged in a spat in early 2020 when Gangwal sought to modify certain rules in the company’s articles of association.

A non-executive director, Gangwal had alleged violations in corporate governance rules at the parent group and wanted to remove an article that prevented co-founders from buying publicly-listed shares in InterGlobe and potentially triggering an open offer for the rest of the company.

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By jaghit

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