Cyrus Mistry’s presence may fragment Tata Group claims Tata Sons; he’s now removed as Tata Industries director as well
Tussle between Cyrus Mistry and Tata Sons seems to have been elongated. Tata Sons, which ousted Cyrus Mistry in October after a boardroom coup, has renewed its appeal to the shareholders of Tata Group companies asking them to remove Mistry from their boards. Despite being ousted from the chairman post of Tata Sons, Mistry is still on the boards of some group companies. Tata Sons claims, this may lead to fragmentation of group.
Tata Sons is the holding company of the $100 billion Tata empire. The appeal from Tata Sons comes just days before the key meetings at six Tata Group companies, which include the Tata Motors and Tata Consultancy Services as well. In these meetings, shareholders are expected to vote on removing Mistry from the respective boards.
In October, when Mistry was ousted from the chairman post of Tata Sons, Ratan Tata came back to the position and took the help of the group. Since then, it has been a power struggle between the two sides. Alongside urging the shareholders to vote against Mistry, Tata Sons has also said that its former chairman misled the selection committee during selection of chairman of Tata Sons after Ratan tata.
In its four-page letter to shareholders Tata Sons said that, Mistry made lofty statements about his plans for the Tata group, but none of them had been implemented. Also, despite agreeing to distance himself from family enterprise Shapoorji Pallonji & Co. Mistry didn’t do that.
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In a statement, Cyrus Mistry has rejected these accusations. He said, the new engineering and construction contracts from Tata Group to Shapoorji Pallonji dropped from INR 11 billion to nearly zero, after he took over the charge of chairman post in Tata Sons. Meanwhile, Mistry has been removed from the post of director of Tata Industries as well following a shareholder voting.