Ousted Chairman of Tata Sons Cyrus Mistry leaves from Bombay House in Mumbai.
Cyrus Mistry will not resign from any group companies where he is the chairman and is ready for legal battle with Tatas — if need be, a family source told Business Standard.
Mistry is currently chairman of all top-listed firms. Tata Sons stake in these companies is low while the institutional/small shareholders are owning the rest. The Shapoorji Pallonji family owns 18.5 per cent in the Tata group holding company, Tata Sons. Tata Sons, in turn, holds 39 per cent stake in Indian Hotels.
Senior independent directors on the board of Indian Hotels are planning to discuss the acquisitions made by the previous management led by former chairman and current Interim Chairman Ratan Tata in the crucial Indian Hotels board meeting to be held in Mumbai on Friday. The removal of Cyrus Mistry as chairman of Indian Hotels is not on the agenda, and the board meeting is to consider the July-September 2016 quarter results.
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Soon after his exit from Tata Sons, Mistry had said Indian Hotels or IHCL had acquired the SeaRock property in Mumbai at a highly inflated price and housed it in an off-balance sheet structure. “In the process of unravelling this legacy, IHCL has had to write down nearly its entire net worth over the past three years. This impairs its ability to pay dividends,” Mistry had written in a letter to Tata Sons’ directors and trustees a day after he was removed. “Many foreign properties of IHCL and holdings in Orient Hotels have been sold at a loss. The onerous terms of the lease for Pierre in New York are such that it would make it a challenge to exit,” Mistry said.
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A director on the board of Indian Hotels said senior directors, led by HDFC Chairman Deepak Parekh and former Hindustan Unilever chairman Keki Dadiseth, are likely to discuss the issues raised by Mistry.