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Infosys row: Narayana Murthy to address investors tomorrow

LiveMint logoLiveMint 22-08-2017 Anirban Sen

Bengaluru: Days after the board of Infosys Ltd blamed N.R. Narayana Murthy for Vishal Sikka’s decision to step down as chief executive, the founder and former CEO of Infosys is set to address investors and assuage concerns, amid a broader tussle between the board and the founders that has severely dented investor confidence in the company and wiped out thousands of crores in market value.

In what is expected to be a highly anticipated address since Friday’s press conference announcing Sikka’s departure, Murthy will be speaking to investors at a conference hosted by Investec India.

Murthy is expected to answer questions and address concerns over the events of the past few days which has spooked investors, especially after the Infosys board released a scathing six-page letter on Friday, blaming Murthy unequivocally for Sikka’s decision to step down. Over the past three days, Infosys has lost nearly Rs. 34,000 crore in market value.

A few days before Infosys issued the statement against Murthy, he had written a letter dated 9 August to half a dozen of his closest advisers in which he claimed that at least three Infosys board members had complained to him that Sikka was not CEO material, but more of a chief technology officer.

“Mr. Murthy’s continuous assault, including this latest letter, is the primary reason that the CEO, Dr. Vishal Sikka, has resigned despite strong board support,” said a statement by Infosys to the stock exchange on Friday. “Mr. Murthy’s campaign against the board and the company has had the unfortunate effect to undermine the company’s efforts to transform itself. The board has been engaged in a dialogue with the founder to resolve his concerns over the course of a year, trying earnestly to find feasible solutions within the boundaries of law and without compromising its independence. These dialogues have unfortunately not been successful.”

Murthy had responded to the statement from Infosys, saying that he was “extremely anguished by the allegations, tone and tenor of statements made by the board,” and that it was below his dignity to respond to “baseless insinuations.”

It is not clear whether on Wednesday Murthy plans to respond to the allegations made by the board. In a short statement on Friday, Murthy had said that he would respond “in the right manner and in the right forum and at the appropriate forum.”

“All that I hear from at least three independent directors, including Mr Ravi Venkatesan (co-chairman), are complaints about Dr Sikka. They have told me umpteen times that Dr Sikka is not a CEO material but CTO material. This is the view of at least three members of the board, and not my view since I have not seen him operate from the vantage point of an Infosys board member,” Murthy had said in his 9 August email.

Murthy on Friday also released the contents of an amended version of the 9 August letter to advisers, which was dated 14 August 2017 where he had said that he did not wish to comment on Sikka’s work, and that his concerns are around governance at Infosys.

“I believe that the fault lies with the current board. We just want the board to protect the institution rather than protecting some individuals like the board is doing today,” Murthy said in his mail to advisers.

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