OP Bhatt, Chairman of IT services firm Coforge, abruptly resigned from the company's board on September 8. His departure follows an internal audit that raised concerns regarding the handling and presentation of the Board Evaluation Exercise and its resulting report.
The audit revealed that certain material information related to the report, including Bhatt's own performance as chairman, had not been fully disclosed to the board when the evaluation was presented. Bhatt offered an explanation but resigned before the board could complete its review of the matter.
Advent International's Role in Board Dynamics
While the immediate cause cited was process-related, Bhatt's exit also brings into sharper focus the growing influence of Advent International, Coforge's largest shareholder. Just weeks prior, at Coforge's annual general meeting on August 24, a resolution for Bhatt's continuation as a director from May 2027 failed to secure the required 75% approval, receiving only around 65% of votes. Advent International notably voted against this resolution.
Shriram Subramanian, founder and managing director of InGovern Research Services, commented, “From these developments, it appears that Advent’s vote played a significant role in the outcome, the voting outcome does suggest that there may have been some differences in the boardroom.”
Impact of Encora Acquisition
Advent's increased sway at Coforge is largely attributed to the company's $2.35-billion acquisition of Encora. This all-stock deal, which closed in April 2026, saw Encora's sellers, including Advent, receive shares representing approximately 20% of Coforge's expanded share capital. The consolidation of Encora's financials began from May 1, 2026.
The acquisition also paved the way for two Advent leaders to join Coforge's board, transforming Advent from a private equity investor exiting an asset into a substantial shareholder with direct representation and a vested interest in Coforge's future trajectory.
Investor Outlook and Future Direction
Bhatt's resignation prompts a broader question about a potential shift towards greater shareholder influence over Coforge's board. However, Subramanian suggests that investors may not need to be overly concerned by the developments.
“I don’t think investors need to be particularly worried about this. To some extent, it is positive that the differences in the boardroom are not being allowed to linger. Had he chosen to stay and the differences continued, it could potentially have led to a divided board. At least now, there is greater clarity on the board’s direction, and there is likely to be more unanimity in boardroom discussions,” he stated.
For Coforge, the immediate challenge lies in ensuring a smooth boardroom transition while management remains focused on the critical integration of Encora. Brokerages have largely separated this governance event from Coforge's operational performance, with firms like CLSA and Nuvama maintaining positive views based on anticipated Encora synergies, growth prospects, and management execution.