Shareholders’ activism in Indian Companies is increasing. Shareholders are finding new ways to make themselves heard by the management.
Now Venkat Subramanian, the MD of Infina Finance (an investment company jointly owned by Kotak Mahindra Bank and the Kotak family) has written an open letter to Sanjeev Bikhchandani, the Co-founder of Info Edge India (IEL). He has requested the following –
- Pare down IEL’s stake in Zomato; and
- Use the proceeds to incubate new ventures that can potentially create larger wealth for IEL’s shareholders in the long run
Investment into Zomato and PB Fintech (Policy Bazaar) have been super success stores for Sanjeev and shareholders have now started looking at IEL as more of a Venture Investment Company than an operating Company (running 99acres, Jeevasaathi and others).
IEL currently owns 15.23% of Zomato i.e., a stake worth more than Rs 19,000 crore at the current valuations.
Most traditional investors consider Zomato to be significantly overvalued with uncertain business prospects and hence the request.
Whether Sanjeev acts on the request, remains to be seen. Though personally I also believe that he himself must be going through the same dilemma – liquidate some more (IEL had sold 3.32% during Zomato listing) or sit tight.
(Exact contents of the letter can be checked here)