With the NCLAT on Wednesday restoring him as executive chairman of Tata Sons, life seems to come full circle for Cyrus Mistry. Cyrus Mistry, son of Pallonji Mistry who is the owner of Shapoorji Pallonji group and the biggest stakeholder in the Tata group, was appointed to the top position in 2012. Relations were seen as amicable between Mistry and Tata till the former was removed as chairman of Tata Sons in October 2016.
Mistry had effected several changes in the business practices due to which capital expenditure increased but returns to shareholders decreased. He replaced the trusted hands of Ratan Tata and his proposed sale of Tata Steel port plant in the UK was seen as harming the goodwill earned by Tata abroad. The extended dispute with Docomo group proved to be one of the nails in the coffin. Tata had to cough up $1.2 billion in arbitration to the Japanese group.
A Civil Engineer from London’s prestigious Imperial College, Mistry was involved in the family’s flagship construction business before he left it to join the Tatas. He learnt the business ropes at Tata Industries, Tata Steel, Tata Chemicals and Tata Motors. And his hard work paid off as he rose to be the director of several other companies like Forbes Gokak, United Motors (India) and Shapoorji Pallonji and Co.
Mistry was the sixth chairman of Tata Sons and had taken over in 2012 after Ratan Tata. Mistry was ousted as Tata Sons chairman on October 24, 2016, and was also removed subsequently as a director on the board of the holding company on February 6, 2017.
Mistry, who was the second person from outside the Tata family to head the group in the last 142 years of its existence, was able to control the group for just four years, one of the shortest tenures for a Tata group head.
Mistry family’s association with the Tatas started in 1930 when Shapoorji Pallonji Mistry bought 12.5 per cent in Tata Sons from the FE Dinshaw Estate. The Mistrys later acquired more stake from the Tata family, taking the SP Group’s holding to about 16.5 per cent. Mistry invested over Rs 60 crore in the Tata Sons rights issue in the ’90s to maintain his stake in the Tata company.
JRD Tata, who became the Tata Group chairman in 1938, initially did not like the idea of Mistry acquiring a major stake in Tata Sons. However, they patched up later and maintained a good relationship for the last two decades. This association was cemented when Pallonji Mistry’s daughter Aloo married Noel Tata, the half-brother of Ratan Tata.
After differences of opinions with group patriarch Ratan Tata, Mistry was ousted as a chairman on October 24 last year in a surprise move by the Tata Sons board. Mistry later moved the National Company Law Tribunal (NCLT).
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