Shapoorji Pallonji Group, Cyrus Mistry's family firm and the majority stake holder in Tata Sons is likely to contest the 'illegal' removal of Mistry as the chairman of the company.
Zee Media Bureau
New Delhi: Shapoorji Pallonji Group, Cyrus Mistry's family firm and the majority stake holder in Tata Sons is likely to contest the 'illegal' removal of Mistry as the chairman of the company, as per reports.
If this turns out to be true, this could be the one of the biggest legal battles in the history of India Inc.
In a surprise move that shock the corporate world on Monday, Board of Tata Sons sacked the 48-year old Cyrus Mistry as the chairman of the company in just under four years after his appointment has the head of the USD 100 billion salt-to-software conglomerate.
And according to PTI, the Shapoorji Pallonji Group, which has 18.4 percent in Tata Sons is believed to be considering fighting out the "illegal" removal while The Times of India reports that Cyrus Mistry has decided to move the Bombay High Court against Tata Sons' decision to remove him from the post of the chairman of the company.
ET Now reports that 8 members of out 9 board members voted with 6 voting for Mistry's ouster while two abstained.
The ET Now report further stated that Pallonji Group said it will contest the move and at the decision to remove Mistry was not unanimous.
In the surprise development, the board of Tata Sons, where 66 percent shares are held by philanthropic trusts endowed by members of Tata family, ousted Chairman Mistry saying it was acting "for the long-term interest" of the firm.
No reason was given for removing Mistry who was brought in less than four years back with much fanfare, but it is believed there were differences over management style and his approach of selling assets after writing them down.
"Tata Sons Board met today and decided to replace him as Chairman with immediate effect. The Tatas Sons board in its collective wisdom and on the recommendation of principal shareholder decided that it may be appropriate to consider a change for the long term interest of Tata Sons and the Tata group," a Group spokesperson said.
Mistry, 48, who replaced Tata, 78, as chairman in December 2012, was only the sixth group Chairman in nearly 15 decades and the first from outside the Tata family. He will remain a director of the individual companies, though his tenure as Chairman is the shortest so far at the group.