Infosys founders may be looking to exit company: report

The bunch of innovators that helped to kindle the IT revolution in India is planning to exit the very business that they founded, Infosys, unhappy with the way in which the company has been run by its present management, says a report.

While there was no word from any of the founders, including NR Narayana Murthy, Nandan Nilekani, SD Shibulal, Kris Gopalakrishnan, KR Raghavan and K Dinesh, a report in The Times of India say the promoters are planning to exit the IT bellwether.

The co-founders, who hold about 12.75 per cent stake in Infosys, worth about Rs28,000 crore, is planning to sell the entire stock, says the report.

Three years after the promoters exited the board of the company, giving way to a professional management team, they now feel that it might be better to exit the company completely rather than pursue a war of attrition with the company's board and management.

Set up in 1981 as a private company, the promoters took it public in 1993 and turned it a professionally-managed company in 2014, but they now feel the company has lost its soul – the idea of Infosys.

Promoters, especially, N R Narayana Murthy and Nandan Nilekani, have long been at odds with the present management. Narayana Murthy and his family are the largest promoter shareholders with a stake of 3.44 per cent.

Narayana Murthy was vexed with corporate governance and the changing cultural ethos of the company, particularly the high compensation packages drawn by CEO Vishal Sikka and other senior Infosys executives, the outsized severance package offered to former CFO Rajiv Bansal, and by acquisition strategies of Infosys. He believed the board led by R Seshasayee had failed in its duty to guide the management in the right direction.

Any stake sale is most likely to take place through stock market block deals, and in tranches. A single, block deal is thought to be unlikely, according to the report.

The move, which comes at a time when the sector is facing business uncertainties, could act as an overhang on its present management and the company's stock price.

Any deal would depend on the likely implications it could have on the price the promoters would get and also for the stock in general.