Indian Hotels convenes EGM on Dec 20 to seek Mistry removal
The Tata Group's hospitality arm Indian Hotels on Monday decided to convene an extra-ordinary general meeting of shareholders on December 20 to consider removal of Cyrus Mistry as director of the company. In a statement issued to bourses on Monday, the company said its board, which met on Monday, has "decided to convene an extra-ordinary general meeting to pass an ordinary resolution for removal of C P Mistry as director of the company".
Tata Sons holds 28.01 per cent of share capital of Indian Hotels Co Ltd (IHCL). "The board of directors of the company, at its meeting held on November 21 has pursuant to the special notice and requisition dated November 9 sent by Tata Sons, shareholder of the company holding 28.01 per cent of the paid-up equity share capital of the company... decided to convene an EGM to consider and if thought fit, to pass an ordinary resolution for removal of C P Mistry as director of the company," IHCL said in a filing to BSE.
The EGM will be held on Tuesday, December 20, 2016 in Mumbai, it added. Mistry continues to be the chairman of IHCL. The Ratan Tata-led interim management of Tata Sons is seeking to oust Mistry from his positions in the operating group firms, including IHCL and Tata Motors.
The EGM comes after the company's board of directors on November 4 supported Mistry's leadership and continuance as chairman of the company. In a sudden and dramatic turn of events last month, Mistry was unceremoniously removed as the chairman of Tata Sons and replaced by his predecessor Ratan Tata in the interim, triggering a confrontation between the single-largest shareholder and the Tatas. After ousting Mistry from Tata Sons, the holding company of 100-odd firms with India's largest conglomerate, promoter Tata Trust is looking at removing him from the operating companies as well. In the days that followed, Mistry was removed as Chairman of Tata Global Beverages, besides TCS. He continues to be chairman of IHCL, Tata Motors and Tata Chemicals.
Meanwhile, upping the ante, Tata Consultancy Services (TCS) on Monday charged its estranged chairman Cyrus Mistry with causing "enormous harm" to the company by his conduct and sought his removal from the company board. In a notice to shareholders seeking his removal, India's largest software exporter said Mistry had "lost confidence" of Tata Sons - the company's largest shareholder and holding company of the USD 103-billion Tata Group.
It went on to cite benefits accruing to it from use of 'Tata' brand by Ratan Tata-led Tata Sons to back its recommendation for Mistry's removal. Within weeks of Ratan Tata replacing Mistry as Chairman of the holding company of the group, Tata Sons by virtue of its commanding 73.26 per cent stake in TCS removed him as the chairman. It also asked the company to convene an extraordinary general meeting (EGM) of shareholders to consider removing him as a director on the board.
At its board meeting last week, which was not attended by Mistry, TCS decided to call an EGM on December 13. In the EGM notice, TCS said, "Subsequent to his replacement as Executive Chairman of Tata Sons Ltd (TSL), Mistry has made certain unsubstantiated allegations, which cast aspersions not only on TSL and its board of directors, but also on the Tata group as a whole, of which TCS is an integral part."
Stating that the communication marked as confidential "was made public", TCS said: "Mistry's conduct has caused enormous harm to the Tata Group, TCS and its stakeholders, including employees and shareholders." The move by TSL to replace Mistry with group veteran Ishaat Hussain as chairman of TCS was seen as an attempt by Ratan Tata-led promoter group to tighten grip over the salt- to-software conglomerate.
"The board of directors of the company is in agreement with... the removal of Cyrus P Mistry as director of the company, as the same would be in the best interests of the company," it said.