Cyrus Mistry resigns from 6 Tata Group companies ahead of EGM
20 Dec 2016
Cyrus Mistry, who took on a boardroom battle with his mentor and Tata Group patriarch Ratan Tata, on Monday announced his resignation from the boards of six group companies and recused himself from all the extraordinary General Meetings (EGMs) scheduled later this week.
Mistry said in a letter to Tata group company shareholders that he was "moving away from the forum of the extraordinary general meetings". He did not specify whether he was resigning from Tata Sons, where he still continues to be a director despite being removed from the boards of group firms.
The six companies - Indian Hotels Co Ltd (IHCL), Tata Steel, Tata Motors, Tata Power, Tata Global Beverages and Tata Chemicals - have convened EGMs to oust Mistry from their respective boards of directors.
Mistry, 48, however, vowed to continue the fight to improve governance within the $100-billion conglomerate. "I am shifting this battle to a larger platform," he said
"Having deeply reflected on where we are in this movement for cleaning up governance and regaining lost ethical ground, I think it is time to shift gears, up the momentum, and be more incisive in securing the best interests of the Tata Group," Mistry said in a letter to the Board of Tata Sons and shareholders.
"Towards this end, the objective of effective reform and the best interests of employees, public shareholders and other stakeholders of the Tata Group (the very people I sought to protect as Chairman) would be better served by my moving away from the forum of the extra-ordinary general meetings."
"It is with this thought in mind that I have decided to shift this campaign to a larger platform and also one where the rule of law and equity is upheld. I had initially not thought that one would need to seek an external forum to adjudicate issues that should never have arisen in the first place."
In a statement issued on Monday, Tata Sons Ltd said the public announcement of the resignation by Cyrus Mistry from the boards of Tata companies is a deliberate strategy on his part, knowing full well that the overwhelming majority of the shareholders were not in support of his actions.
''Unfortunately, Mr Mistry continues to make baseless, unsubstantiated and malicious allegations using selective disclosures of information against the very institution he claims to have the highest regard for.
''Tata Sons has responded to his charges on multiple occasions and will respond adequately to any allegations made by Mr. Mistry. Tata Sons strongly resents the claims by Mr Mistry to align with the values and ethics of Jamsetji Tata and the Tata Group. On the contrary, Mr. Mistry and his family companies have not upheld the high standards and values set by Jamsetji Tata and his successors. Mr. Mistry has done precious little to build the goodwill of the Tata Group, built through the hard work and dedication of its employees.
''Mr Mistry has been a director of Tata Sons since 2006 and as such was fully involved in all the key decisions that the Tata Group had taken over the years. It is unfortunate that it is only on his removal as chairman that he began making allegations and misrepresentations about business decisions he was party to for over a decade.
''As Tata Group, we are committed to upholding the highest standards of ethics and value systems put in place by the Founders. It is these that have made the Group what it is today. We will do whatever it takes to protect the interests of all stakeholders of the Tata Group,'' the statement added.