Recap: Boardroom war escalates, Mistry removed as director of Tata Industries

Mistry was removed as director of Tata Industries on Monday, this week

Cyrus Mistry was today removed as director of Tata Industries following shareholders' vote, the first such instance of the embattled executive being ousted from the board since his removal as Tata Group chairman.

Mistry also ceases to be the chairman of the company following his removal as director, Tata Industries said.

"Tata Industries, at its extraordinary general meeting on December 12, 2016, removed Cyrus P Mistry, as a director of the company. Hence, he also has ceased to be the chairman of the company," it said.

Mistry was abruptly ousted as chairman of Tata Sons -- the holding company of the USD 103 billion salt-to-software conglomerate -- on October 24. Since then, interim Chairman Ratan Tata has moved to consolidate his position by seeking to remove Mistry from boards of key listed firms.

Even with the latest development, the Tata vs Mistry battle has been raging unabated, with both sides taking shots at each other over the past week. 

Here's what you've missed of the boardroom battle that has India Inc, and the country's, attention.

Mistry refutes Tata's allegations

Refuting allegations that he misled the selection committee set up in 2011 to find new Tata Sons Chairman, Mistry on Sunday hit out at Tata Sons Interim Chairman Ratan Tata saying his predecessor's "conduct has eroded the Tata brand and values materially".

On a series of allegations leveled against him by Tata Sons in a letter to stakeholders of Tata firms, Mistry said, "Repeat a lie a thousand times and hope it becomes a truth, seems to be Ratan Tata's last-ditch effort to overcome a monumental disaster his actions have unleashed." ( Read more here) 

Tatas accuse Mistry of misleading selection committee to get selected as chairman

Mistry's rebuttal came after Tata Sons said that Mistry had misled the selection committee set up in 2011 for selecting a chairman to succeed Ratan Tata.

"Mistry made lofty statements about plans for Tata Group, but didn't give into effect management structures and plans he promised," stated Tata Sons. Mistry did not distance himself from his family enterprise Shapoorji Pallonji & Co as promised, Tata Sons further stated in a press release. ( Read the details here) 

Mistry reaches out to shareholders of Tata Motors and Tata Chemicals 

Mistry wrote to the shareholders of Tata Motors and Tata Chemicals to seek their support against the special notice to remove him as director from the boards of both companies. Mistry said there was a crying need to reclaim the glory of the Tata group, and that the governance framework needed urgent repair at the level of Tata Sons, the holding company of Tata Motors, and at Tata Trusts, which are the major shareholders of Tata Sons. He said the entire Tata group was at an inflexion point and that “the movement to reform cannot and will not be arrested”. ( Here is what he said) 

InGovern advises minority shareholders to not oust Mistry

Proxy advisor InGovern asked minority shareholders of Tata group companies to vote against the promoters' proposal to remove Cyrus Mistry from their boards, saying they have not provided "any compelling reasons".

Six of the seven Tata listed group companies where Mistry serves as a director have called extraordinary general meetings (EGMs)  between December 13 and 26 after having received requisition to this effect from the promoter shareholder, Tata Sons. ( Read more here) 

Nusli Wadia goes to Sebi

Wadia, an independent director on the boards of Tata Chemicals, Tata Steel and Tata Motors complained to the stock market regulator, the Securities and Exchange Board of India alleging insider trading norms violations in various Tata companies. Wadia also complained about the shareholder resolutions moved by the three companies for his ouster without giving any valid reasons. ( Details here) 

Tata Teleservices calls Dec 14 EGM to oust Mistry as director

Unlisted Tata Teleservices called an EGM of its shareholders to remove Cyrus Mistry as a director on December 14 as part of the Tata group’s plans to remove him from the boards of all its group companies. ( Read more here) 

Misty calls Tata a liar

Terming Ratan Tata's letter to shareholders of Tata companies a combination "misrepresentation and convenient mischaracterisation", ousted Tata Sons Chairman Cyrus Mistry hit back saying the veteran industrialist is lying. ( Read more here)

Tata's letter to shareholders says Mistry was given chance to step down

Seeking the support of minority shareholders to remove his former protégé, Mistry, Tata on Wednesday had said Mistry’s presence on the boards of various Tata group companies was a serious disruptive influence and could make Tata companies dysfunctional.

In a letter addressed to Tata group shareholders, Tata said Mistry was removed as the Tata Sons board had lost confidence in him and his ability to lead the conglomerate. 

https://www.business-standard.com/article/companies/mistry-was-given-option-to-quit-but-he-refused-ratan-tata-116120701334_1.html

Mistry violated corporate governance norms, allege Tatas

Tata Sons on Wednesday refuted charges of breakdown of governance levelled by Mistry, saying it was the ousted chairman who has been violating such guidelines. “The same corporate governance guidelines, Mr Mistry’s office is referring to, prescribes that a Tata employee must step down from the Boards of Tata companies, after he ceases to be a Tata employee. After being replaced as Chairman of Tata Sons, Mr Mistry ceases to be a Tata employee. It is he who is violating the Guidelines that he himself propounded, and not Tata,” a Tata Sons spokesperson said. ( Read more here) 

Mistry says he is fighting to protect Tata Group

Alleging that individuals prone to “impulsive control” had exposed the Tata Group to perilous violation of regulatory requirements, ousted Tata Sons Chairman Cyrus Mistry on Tuesday said his fight was to protect the conglomerate from “capricious” decision-making by Ratan Tata.( Read details here) 

Legal eagles pitch in

On Monday, Mistry had asked the government to intervene in the Tata dispute so that it could become accountable and improve corporate governance standards. The Tatas had rejected the charges and said Mistry was trying to convert the group into his ‘personal fiefdom’. 

According to corporate and securities lawyers, the legal options before Mistry were to move Sebi and MCA and highlight his communication on Monday, which alleged that Tata trustees were interfering in the working of listed Tata companies and seeking information. ( Read more here) 

Mistry wants the govt to step in

Mistry fired another salvo against former mentor Ratan Tata on Monday, by requesting that the government ensure transparency in the Tata Trusts, to make these more accountable to the public and to ensure they follow corporate governance norms of the highest order.

He sent a 14-page letter to the six Tata Group companies and their shareholders that are meeting this month, to consider a proposal to remove Mistry as a director. The letter said that at the heart of the sustainability of the Tata group was governance reform throughout the institution and that this was presently lacking. “This would mean the government ensuring the working of the Tata Trusts, which are public charitable trusts, the property of the people of India, have a defined, transparent governance structure,” he said in the letter and asked the companies to place it before the shareholders. ( Read more )

Tatas accuse Mistry of trying to take over the group

The Tata group said on Monday that Mistry had converted the group into his personal fiefdom which finally led to his ouster as chairman. 

In a statement, the Tatas said that after he became the chairman of Tata Sons, Mistry converted the group into his personal fiefdom with unilateral actions destroying the precious institutional memory of the House of Tata. ( Read more) 

Wadia could spell trouble for the Tatas

While six EGMs have been lined up, starting December 13, the real test for the group may come a week later, on December 21, when Tata Steel holds its EGM, seeking to remove Cyrus Mistry and Nusli Wadia as directors. Wadia is a director in three Tata firms — Tata Steel, Tata Motors and Tata Chemicals — and he’s expected to address shareholders at all three EGMs, where resolutions to remove him as director will be put to vote.

Those three EGMs are being seen as the most challenging for the group as the backroom war, charges and counter-charges between Wadia and the Tatas would play out in the open before shareholders, a source said. ( Read more)