Infosys CEO Vishal Sikka resigned unexpectedly Friday, penning a three-page letter that alludes to a long-running feud with the Indian IT outsourcing company's founder.
"Over the last many months and quarters, we have all been besieged by false, baseless, malicious and increasingly personal attacks," Sikka, who joined Infosys three years ago after serving as SAP's CTO, wrote in the letter. "The continuous drumbeat of distractions and negativity over the last several months/quarters inhibits our ability to make positive change and stay focused on value creation."
The shocking departure worried the investment community, which sent Infosys' stock down $1.44 (9.04%) to $14.49, the company's lowest trading price since April.
Infosys COO U.B. Pravin Rao was named as interim managing director and CEO of the Bengaluru, India-based systems integrator. Rao will report to Sikka, who will serve as executive vice chairman until a permanent CEO takes office, which Infosys said is expected to happen no later than March 31, 2018.
"I cannot carry out my job as CEO and continue to create value, while also constantly defending against unrelenting, baseless/malicious and increasingly personal attacks," Sikka wrote in a letter to Infosys employees, which he shared in a blog Thursday. "After much contemplation, I have decided to leave because the distractions, the very public noise around us, have created an untenable atmosphere."
The company's board backed Sikka and deflected criticisms made by company founder and former chairman NR Narayana Murthy, who claimed in recent emails that Infosys' independent directors felt that Sikka was more CTO material than CEO material.
"The Board is profoundly distressed by the unfounded personal attacks on the members of our management team that were made in the anonymous letters," Infosys said in a statement. "The Board denounced the critics who have amplified and sought to further promote demonstrably false allegations, which have harmed employee morale and contributed to the loss of the company's valued CEO."
Murthy fired back several hours later, noting that he voluntarily left Infosys' board in 2014 and was not seeking any money, power or positions for his children. Murthy has in the past questioned pay raises granted to Sikka and Rao, as well as the size of severance payments given to others.
"I am extremely anguished by the allegations, tone and tenor of the statement," Murthy said in his response. "My concern primarily was the deteriorating standard of corporate governance, which I have repeatedly brought to the notice of the Infosys board."
Infosys under Sikka set a goal of hitting $20 billion in revenue by 2020, but the $10.2 billion solution provider would be hard-pressed to reach that goal given that the company gave revenue growth guidance of just 6.1 percent to 8.1 percent for the current fiscal year.