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Tata Sons chairman Cyrus Mistry out after four years at helm



Cyrus Mistry whom Tata Sons on Monday removed as its Chairman, nearly four years after he took over the reins of the group.

Cyrus Mistry whom Tata Sons on Monday removed as its Chairman, nearly four years after he took over the reins of the group.

SAN FRANCISCO (Diya TV) — Nearly four years after assuming control as head of the $103-billion automobiles-to-salt conglomerate, it was announced Cyrus Pallonji Mistry was “replaced” by the board of Tata Sons, the group’s holding company without any reasons being assigned.

Mistry, chosen as Chairman of Tata Sons in Nov. 2011, has been replaced by his predecessor Ratan Tata as interim chairman.

“Tata Sons today announced its board has replaced Mr Cyrus P Mistry as Chairman of Tata Sons. The decision was taken at a board meeting held here today,” a company statement read.

Tata who had retired in 2011 when he turned 75 will now be back at Bombay House, the headquarters of Tata group in Mumbai in the near term until a new chairman is appointed.

Reports indicate the existence of possible boardroom management issues might have served as Mistry’s demise. Former Solicitor General Mohan Parasaran said in an interview that the group had sought legal opinion a month ago on “issues relating to management.”

“He was replaced due to management issues,” Parasaran said.

The Tata Sons board constituted a Selection Committee to choose a new Chairman for Tata Sons which holds significant stakes in Tata companies. The committee has Ratan Tata, industrialist Venu Srinivasan, investment banker Amit Chandra, ex-diplomat Ronen Sen and economist Lord Kumar Bhattacharyya.

“The committee has been mandated to complete the selection process in four months,” the Tata Sons board said in a release after a meeting on Monday.

The Mistry family — headed by Cyrus’s father, construction mogul Pallonji Mistry — which holds around 18 percent stake in Tata Sons is the largest individual shareholder — and non-Tata shareholder — in the Tata holding company. In 2011, Cyrus Mistry was part of the Selection Committee to identify the successor but surprisingly he was picked up as the successor by Ratan Tata. Naval Tata, Ratan Tata’s half brother, was also a contender.

According to The Economist, Tata is eyeing further expansion: defense, infrastructure and financial services are the latest targets. There is a growing sense that it lacks the “refocus” gene altogether. “Nearly four years into Mistry’s tenure, the listless performance that could once have been blamed on things like slowing Chinese demand seems to be entrenched. One former adviser to several Tata CEOs says that ‘the risk is that Tata uses its long-term emphasis and ethical way of doing business as an excuse to tolerate underperformance’,” it said.

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