Darbari quits ACC board

MUMBAI, Aug 19: Close on the heels of the decision by Nani Palkhivala to give up the chairmanship of Associated Cement Companies (ACC), Dar...

MUMBAI, Aug 19: Close on the heels of the decision by Nani Palkhivala to give up the chairmanship of Associated Cement Companies (ACC), Darbari Seth, one of the patriarchs of the Tata group, has stepped down from the board of the cement gaint.

Acccording to an ACC statement, Seth’s withdrawal is "part of his plans to reduce his corporate involvement". In a letter to ACC chairman Palkhivala, Seth said: "… it was a matter of great joy and satisfaction to him to have participated in the growth of ACC" and was leaving the board with a "deep sense of satisfaction".

He had been inducted onto the company’s board in 1988 and played a major role in the revival of ACC. In fact, Darbari was instrumental in the Tatas getting an equity stake in the company in 1987-88.

Darbari Seth’s resignation brings the number of Tata group representatives on the ACC board to three. The others are deputy chairman Pallonji Shapoorji Mistry, NA Soonawala and SR Vakil. One reason for Darbari’s decision can be ACC board’s decision to remain out of the Tata hold. However, Seth was not available for comments.

It could not be ascertained at this stage whether Seth will be replaced by another representative from the Tata group, which has a 11.2 per cent stake in the cement company. Mistry who holds a significant stake in Tata Sons is slated to become the next chairman of ACC Recently, Palkhivala also decided to give up his chairmanship, though he will continue to be on the board as a director. Though the decision has not been made official yet, ACC sources said Palkhivala will make a formal announcement at the annual general meeting scheduled in September.

Seth, the man who built Tata Chemicals, grew up in the Tata group in the shadow of the late JRD Tata, the doyen of Indian industry. He was one of the three close associates along with Russi Modi of Tisco and Suman Mulgaonkar of Telco of JRD who managed to keep his independent identity within the group.

The trio, along with JRD, not only helped the Tata empire to branch out but also managed to create their own band of loyal followers within the Tata group companies that they controlled.

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The stepping down of Seth from the ACC board comes at a time when the company has decided to stay out of the Tata empire. ACC has also decided not to pay any royalty to Tata Sons as the former is not using the Tata brand name. It may be recalled that Seth had quit as chairman of Tata Chemicals and Tata Tea two years ago, paving the way for Tata Sons chief Ratan Tata to step in as the chairman of both the companies.