One of the bloodiest battles in India’s corporate history might come to an end early February, as the Tata Sons (the board that governs the Tata Group) will hold its last extraordinary general meeting (EGM) a month before Cyrus Mustry’s term ends as its board member.
The meeting, sources said, will result in the removal of Mistry even as a board member. This comes in close succession of the series of planned attacks between the two parties – Cyrus Mistry and Ratan Tata.
So far -- a financial daily reported -- that no notice has been issued for the meeting to be held, which is expected to come by Thursday. Mistry’s removal from the board is unprecedented as Shapoorji Pallonji, the company promoted by the Mistry family is the single largest shareholder of Tata Sons with 18.4% stake.
The battle began on October 24, when Mistry was sacked as Tata Sons’ chairman, resulting into a lot of mud-slinging between the two parties. Tata and heads of various group companies blamed Mistry of mismanagement and underperformance of the group companies. This also resulted in exits of a lot of Mistry favourites.
Mistry has already resigned from the board of all listed group companies in December, after he was voted out at few of the company EGMs.
He also dragged Tata Sons to the National Company Law Tribunal (NCLT) on charges of “oppression and mismanagement”, next hearing of which is due on January 31.
While there is a lot of speculation around the fact that Mistry might seek a stay at NCLT, one shouldn’t forget that inside Bombay House, headquarters of the Tata Group, Ratan Tata is the big man. Tata Trusts, owned by the Tata family, own 66% stake in Tata Sons.
However, legal experts would tell you that if there is any sort of opposition from Mistry’s end, Tata Sons would contest the move. After all Ratan Tata is known to have fought the satraps who once ran their companies like a fief, and made them fall in line and made the group cohesive, modern, and agile.
With all that power, Tata Sons would ideally want Mistry’s exit at the earliest – putting an end to the battle, where otherwise the much respected Tata Group, has had a dent in its image.