Food delivery platform, Swiggy Ltd, on Wednesday said it will "engage constructively" with stakeholders for amendments to the Articles of Association for securing Indian Owned and Controlled Company (IOCC) status and ensuring continuity of domestic management oversight and execution of company's strategic plans. 

"Company will continue to engage constructively with its shareholders and other stakeholders and will evaluate any future structural or strategic steps through lawful, transparent, and shareholder-aligned processes," Swiggy said in a notice to the exchanges on yesterday. 

"Strong governance, transparency and shareholder accountability are central to how Swiggy operates, and the Company is working constructively with all its shareholders to address their concerns and achieve a positive outcome," the company said.  

It may be noted that the shareholders had earlier rejected Swiggy's proposed amendments to the Articles of Association. The company said the special resolution received 72.36% votes in favour, against the required 75% threshold. 

What is the rationale behind Swiggy's move?

The company also set forth the rationale behind the move. 

"The Company does not have an identifiable promoter group. In a company with a diversified shareholding structure, a governance architecture that provides for representation of the founders and senior management at the Board level is both appropriate and necessary, to ensure continuity of domestic management oversight, accountability for the execution of the Company's strategic plan, and the Board composition required to support the Company's Indian Owned and Controlled Company ("IOCC") objectives," it said in the filing. 

"The Proposed Amendments were a preparatory step towards the Company’s objective to qualify as an IOCC under applicable Indian foreign exchange laws and regulations - an objective that is consistent with the direction taken by comparable companies in India and which the Company believes will drive long-term shareholder value," it added. 

"Further that the IOCC classification will additionally require resident Indian shareholding to exceed 50% along with applicable regulatory and shareholder approvals," it said. 

It may be noted that the voting for the special resolution for the amendment of its Articles of Association (“Proposed Amendments”) took place on May 21.