Days after reports trickled out that Mu Sigma founder Dhiraj Rajaram is planning to acquire controlling stake in the firm, it is being speculated that Ambiga Subramanian, CEO of the data analytics firm, is planning to launch her own venture as she negotiates a partial sale of her stake in the firm. As per an ET report, Ambiga is also likely to take over half-a-dozen key executives from Mu Sigma to join her at the new company that will be set up once negotiations to divest some of her current Mu Sigma holdings are over.
As per an unnamed source aware of the development, Ambiga has refused to include a non-compete clause in the agreement and is likely to start a related business once the deal is complete.
Apparently, Dhiraj’s plan is to acquire 27% from Subramanian and General Atlantic, giving him a 51% stake. He already owns 24% in the company. That would leave 21% with Subramanian and General Atlantic to be acquired by investors/funds who agree to back him.
The data analytics firm, which was one of India’s earliest unicorns, has been facing uncertainty over future ownership and management on account of the divorce between Dhiraj and Ambiga this May. Ambiga, who was appointed as the CEO in February 2016, continues in her position. As CEO, she handles the Bengaluru office, while Dhiraj focusses on client engagement in the US out of the company’s Chicago headquarters.
Around the time their divorce became public, both Dhiraj and Ambiga had separately talked to ET stating that the development would have no impact on the running of the company. Dhiraj had stated that Ambiga “may not continue in the role of CEO” in the “long-term,” although “as of now, she will continue in the role. He had stated,
It is true that our marriage is in a difficult spot. As of now, there are no changes to the management of the company. Both Ambiga and I are very motivated to do the best for the company and we continue to be very passionate about Mu Sigma.
Similarly, Ambiga had clarified,
I don’t expect any change in the management of the company due to the divorce. This is just a personal matter and will not have any impact on the company. Our commitment is to the employees of Mu Sigma and the shareholders. I’m still the CEO of the company.
However, the situation seems to have changed a couple of months down the line. While Dhiraj is expected to join hands with private equity investment firm General Atlantic, an investor in Mu Sigma, to jointly negotiate a stake sale and acquire majority control, Ambiga’s plan to strike out on her own with four-five key executives will further impact the firm which has been dealing with attrition at key operational posts.
As per an anonymous source, the executives likely to join Ambiga own about 4-5% equity of the company through employee stock option plans and they too will be selling out their stakes. About nine out of 15 members of the leadership team have left ever since the couple got estranged.
Dhiraj, however, had stated to ET that the people who quit were not a part of the leadership team but were “apprentice leaders”, which ranks below chief executive, geography head, regional head, and delivery leader.
With more expected to follow suit, things certainly look messier for Mu Sigma at the moment.
The development was first reported in ET.
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