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Tata-Mistry letter wars escalate as group shareholder votes near
[MUMBAI] Cyrus Mistry, the ousted chairman of Tata Group, accused its biggest shareholders of eroding governance at India's largest business empire and portrayed himself as a defender of independent decision-making in a letter to investors in Tata companies. The conglomerate refuted his allegations.
Mistry made his appeal on Monday before a series of extraordinary general meetings from Dec 13 to Dec 26, which were sought to remove him as a director from six companies including Tata Power Ltd and Tata Motors Ltd, owner of Jaguar Land Rover. The investor votes were called after Mistry resisted efforts to step down as chairman of key group companies following his Oct 24 removal as head of holding company Tata Sons Ltd.
In a 14-page missive, Mr Mistry accused family patriarch Ratan Tata and NA Soonawala, trustees of charitable organizations that own a majority stake in the holding company, of overstepping their roles and attempting to improperly control decision-making. Tata Sons charged Mr Mistry with concentrating power and authority in his own hands and diminishing the role of its board. The feud between Mr Mistry and Ratan Tata has escalated since a boardroom coup that brought the latter back to the head of the $100 billion Tata empire.
"The Tata Group is no one's personal fiefdom: it does not belong to any individual, not to the trustees of Tata Trusts, not to the Tata Sons directors, and not to the directors of the operating companies," Mr Mistry wrote in the letter. "Governance reform is a must at the level of Tata Sons, and even more importantly at the level of Tata Trusts." Tata Sons, in a two-page rebuttal said that "genuine selfless governance" had driven the group for over a century.
"After he became the chairman of Tata Sons, it is Mr. Mistry who converted the group into his 'personal fiefdom', with his unilateral actions destroying precious institutional memory of the House of Tata," Tata Sons' said in the e-mailed statement Monday.
The response followed Mr Mistry's claim that Ratan Tata and Soonawala used board members of Tata Sons, nominated by charities started by the Tata family, to exert "indirect control" on the group. The two men interpreted the group's articles of association to mean they could call for more information and seek discussion on any subject they considered material, Mr Mistry wrote.