Infosys CEO quits after fall-out with founders

Infosys CEO quits after fall-out with founders

The CEO of Indian IT services giant Infosys has unexpectedly resigned, citing a falling out with the company's founders.

The sudden departure of Vishal Sikka took the stock market by surprise, resulting in an 8% drop in the company's share price.

The Infosys board has been engaged in a war of words with the company's founders for some time. In his resignation letter, Sikka referred to "false, baseless, malicious and increasingly personal attacks" from the founders that had undermined the company.

"This continuous drumbeat of distractions and negativity inhibits our ability to make positive change and stay focused on value creation."

Sikka, a former board member at German IT firm SAP with a penchant for t-shirts rather than suits, was brought in to lead Infosys in 2014 becoming the first non-founder to take the CEO role.

However the relationship soured in recent months with the founders, who retain a 12.75% share in the company, voicing a growing number of complaints about various governance issues, including a pay rise granted to Sikka and several severance packages to other executives. 

A company statement singled out founder Narayana Murthy as "the primary reason" for Sikka's resignation "despite the strong support" of the board. 

The statement also said that the founders' attacks had thwarted Sikka's attempts to transform the company. These efforts had also been hampered by what Sikka had earlier referred to as the "challenging environment out there".

Infosys had set itself an ambitious revenue target of $20bn by 2020 - one that may now be under threat amid both the short-term uncertainty caused by Sikka's unexpected departure and some of the longer-term issues facing the $150bn Indian IT services industry, such as the shrinking number of deals with Western clients and new Visa rules from the US, its largest overseas market. 

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