Concerns existed about Mistry not keeping the board in the loop on key appointments and decisions, the Economic Times reported…
Big Wire New Delhi Bureau
India’s diversified business conglomerate Tata Sons replaced Cyrus P. Mistry as Chairman in an unusual surprise move. The decision was taken on Monday by its board of directors in Mumbai.
The board named 78-year old Ratan N. Tata as its interim chairman and announced the formation of a selection committee for the new chairman.
It was not clear what prompted the board to replace Cyrus Mistry. Tata Sons did not disclose any reason behind the change of leadership.
Here are the compilations of different developments Tata Sons witnessed during Cyrus Mistry’s tenure as chairman and possible reasons the newspapers, leading websites have cited on his replacement.
Cyrus P. Mistry, aged 48 years, is the youngest son of construction tycoon Pallonji Shapoorji Mistry. Pallonji is the single largest shareholder of Tata Sons with having an 18.5 per cent stake.
The Mistry junior had taken over Tata Sons from Ratan Tata in 2012. He was brought in with much fanfare at that time.
“Tata Sons was unhappy with Mistry’s approach of shedding non-profit businesses, including the conglomerate’s steel business in Europe, and concentrating only on cash cows” says Times of India report.
Mistry was concentrating his business strategies only on group’s growing strong business like Tata Consultancies Services.
He was reportedly ignoring the businesses which were not performing well, according to media reports.
The board made its decision with six of the nine members backing the ousting of Mistry while two members abstained. Mistry, who could not vote, now remains a board director.
The board disbanded the group executive council (GEC) – a team of core advisers that Mistry had formed.
Concerns existed about Mistry not keeping the board in the loop on key appointments and decisions, the Economic Times reported on Tuesday as one of the reasons behind the Mistry’s ouster.
Key decisions on merger and acquisition related to the sale of Tata Steel Europe and acquisition of Welspun were questioned, it added.
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