(Bloomberg) -- Rakesh Gangwal, one of the founders of Indigo, has no desire to take control of India's biggest airline, according to a statement by Chief Executive Officer Ronojoy Dutta.
“I am categorically and clearly stating that there is no interest or desire whatsoever on the part of the RG Group to take control of the company,” Gangwal said in the May 18 statement, which included the comment on his behalf. The RG group stands by the current shareholder agreement, which expires in October, he said.
Indigo shares dropped the most in a year on Thursday after reports that its billionaire founders Rahul Bhatia and Gangwal have hired law firms and are trying to sort out disagreements about the carrier's future strategy and clauses in the company's shareholder agreement.
Founded in 2005 by former U.S. Airways CEO Gangwal and former airline sales agent Bhatia, IndiGo has quickly outpaced its rivals to grab almost half of the local market, making both founders billionaires. IndiGo is one of the few Indian carriers with enough cash to aggressively expand, and it's been mapping out a way to build a long-haul, low-cost business to take passengers from places like New Delhi to London.
“We all know that in any strong and well-managed company there will always be differences. And, yes, there may be differences currently on certain matters, but the company has a great track record of resolving issues and coming out ahead,” CEO Dutta said. “If the current differences were to not get resolved, you shall certainly hear about it; however, it serves no purpose speculating about it.”
Shares of InterGlobe Aviation Ltd., which operates IndiGo, slid about 4% last week, paring this year's gain to 26.5%. It had closed at an all-time high on Wednesday.
--With assistance from Anurag Kotoky.
To contact the reporter on this story: Pratik Parija in New Delhi at pparija@bloomberg.net
To contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, John McCluskey
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