Vishal Sikka defends Panaya deal in letter to Infosys employees

The letter follows a whistleblower’s letter to Sebi alleging violation of governance norms in the $200-million acquisition of Israeli startup Panaya in 2015 – shortly after Sikka took charge as CEO.

Vishal Sikka, infosys, Infosys employees, governance issues, Israeli startup acquisition, Israeli startup Panaya, business news

Vishal Sikka. PTI Photo

Infosys CEO Vishal Sikka, who is caught in a storm over alleged governance issues, has in a new letter to employees sought to brush aside questions raised on the acquisition of an Israeli startup by an anonymous whistleblower as possible attempts to malign the company by people upset with the changes at the firm.

“I am, as always, counting on your faith and unwavering attention to what really matters. Change is never easy, and change at the scale that we are undertaking may be unprecedented, and perhaps it is this change that has so inflamed some into trying to drag us all into the mud,’’ Sikka said on Monday in the letter.

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The letter follows a whistleblower’s letter to Sebi alleging violation of governance norms in the $200-million acquisition of Israeli startup Panaya in 2015 – shortly after Sikka took charge as CEO.The letter comes close on the heels of governance issues — including a Rs 17.38-crore severance package for former CFO Rajiv Bansal and a 55 per cent pay hike for Sikka — being raised by a group of Infosys founders led by NR Narayana Murthy.

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The anonymous letter alleged that Panaya was bought for over $200 million despite the firm being valued at $162 million during an E-series funding a month prior to the purchase. The letter alleged that the Panaya deal benefitted Hasso Plattner, the co-founder of SAP — where Sikka was the CTO before joining Infosys in 2014. Plattner had 8.33 per cent stake in Panaya. Venture firm Israel Growth Partners were the series E investors.

The letter alleges that the Infosys board failed to see governance issues involved while clearing the Panaya deal and that Bansal’s exit was linked to differences over the Panaya acquisition. Sikka in his letter rejected the allegations over the Panaya deal as malicious propaganda to hurt the firm.”Once again today, some newspapers have carried false and malicious stories … These speculations are clearly designed to tarnish our reputation. They create a false alternate-reality out of events and dates, with embellishments that are calculated to mislead and sensationalise,’’ said Sikka.