Yatra shareholder pulls up board for mismanagement, seeks corporate governance overhaul

Yatra shareholder pulls up board for mismanagement, seeks corporate governance overhaul
Dhruv Shringi  |  Photo Credit: VCCircle
27 Jul, 2021

In an open letter to shareholders of online travel aggregation (OTA) platform Yatra Online Inc, the 2020 Timothy J Maguire Investment Trust and its affiliates, Maguire Investment, has asked for an overhaul of the company’s corporate governance and transparency. As part of the letter, the trust listed out a Yatra 2022 Plan to improve the performance metrics of the OTA.

Read the SEC filing for full details.

The trust and Maguire Investment with an aggregate ownership of 7.4% of Yatra’s outstanding shares pointed put lack of transparency in executive compensation packages and lack of operational and industry experience among senior management and the board of directors. It further said that the company did not consider a candidate recommendation for the board made by Maguire Investment. 

Among other issues, the letter also said that the senior management and the board should have avoided the merger with US based Ebix which did not go through. Ebix had entered into a definitive agreement to acquire Yatra’s business in July 2019 but failed to close it despite multiple extensions. A year later Yatra cited breach of terms of agreement by Ebix at the time and terminated the agreement, initiating legal proceedings against the latter.  

“Despite a long list of red flags that should have counselled it against entering into the Ebix merger, the Board seems to have failed to perform the basic due diligence necessary to protect shareholder capital,” said the letter.


Following the merger being called off in June 2020, Yatra managed to raise $11.5 million through the public market route. The letter mentions that as on April 1, 2021, Yatra had $33.7 million in net cash and $110,000 in debt.

The investment trust also said that the board had failed to hold an annual general meeting after 12 December, 2018, and had stated that it does not plan on holding one in the future.

“By doing so, the Board has self-servingly determined to allow all five of its directors to serve on the Board indefinitely, going against the fundamental precepts of good corporate governance practices…,” said the letter.

It flagged that Yatra CEO Dhruv Shringi would be up for election at the subsequent AGM in 2019 which was never conducted.

The letter also said that the shareholders of the company did not have an insight into the compensation structure of Shringi as well as other executive officers in the company by virtue of being a foreign private issuer.  

Citing the success of peers MakeMyTrip which is listed on NASDAQ and EaseMyTrip which is listed in India, the letter said that Yatra had failed to capitalise on opportunities even before Covid-19 impacted the OTA space.

“For example, while the Company’s air ticketing margin percentage hovered between 5-6% between 2016 and 2020, global travel agencies as well as local competitors operated in the 10-20% range,” said the letter adding that Yatra failed to pursue cross-selling and ancillary revenue opportunities.