Mistry’s removal was ‘necessary’: Tata
As ousted Tata Group Chairman Cyrus Mistry stepped up his attack, Ratan Tata on Tuesday hit back saying his removal was “absolutely necessary” for the future success of the Tata Group.
“The decision to change the leadership of Tata Sons was a well-considered and serious one for its board members. This difficult decision, made after careful and thoughtful deliberation, is one the board believes was absolutely necessary for the future success of the Tata Group,” the interim chairman wrote to employees of USD 100 billion Group.
The letter came shortly after Mistry ratcheted up war of words by rebutting “insinuations” of mishandling a dispute with Japan’s NTT DoCoMo, saying Ratan Tata was party to all decisions regarding the telecom venture.
Tata, 78, who retired as Tata Group Chairman nearly four years back, justified his return for “maintaining stability and continuity of leadership” and promised to give the group “a world-class leader” when a fulltime boss is appointed.
Earlier in the day, Mistry’s office issued a statement saying all decisions on the telecom joint venture with DoCoMo and the following dispute were taken with unanimous approval of Board of Tata Sons as well as family patriarch Ratan Tata.
The handling of the USD 1.17 billion compensation slapped by an arbitration panel over breach of agreement with DoCoMo is said to one of the triggers for Tata Sons sacking Mistry last month.
“Insinuations that the Docomo issue was handled under the watch of Mistry in a manner inconsistent with Tata culture and values are baseless. The suggestion that Ratan Tata and the trustees would not have approved of the manner in which the litigation was conducted is contrary to what transpired,” the statement said.
Responding to the statement, a Tata group spokesman said: “The insinuations are being imagined and this (DoCoMo) matter is sub-judice.”
Tata in his second letter to employees after the October 24 sacking of Mistry, said the Group companies should focus on their profit margins and their market position and not compare themselves to their own past.
“The focus has to be on ‘leading’ rather than ‘following’,” he wrote.
Stating that he was excited to work with them once again, Tata in his letter to over 6.6 lakh employees sought to soothe them in the wake of high profile top level change and its subsequent public spat with Mistry.
“Your company and the Tata group are well served. The directors on your boards and the empowered leadership of your companies continue to serve with the same degree of passion and ethical commitment as they have done in the past,” he wrote.
As a group, Tata continued, “we are steadfast in our resolve to maintain the Tata culture and value system that all of us have worked so hard to nurture over the decades.”
Praising the spirit the employees, he said, “During its long history, the group has faced and overcome many challenges. Our employees have displayed their spirit at all times to create great companies that have delivered value to the shareholders.”
Meanwhile, N S Rajan and Nirmalya Kumar resigned as non- executive directors on boards of Indian Hotels Company and Tata Chemicals respectively, days after Group Executive Council set up by Mistry was disbanded.