Cyrus Mistry petition seeks ouster of Tata Sons board

Wed Dec 21, 2016 3:56am EST
 
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By Promit Mukherjee and Euan Rocha

MUMBAI (Reuters) - Tata Sons' [TATAS.UL] ousted chairman Cyrus Mistry, in his first legal salvo against the conglomerate, has appealed to a quasi-judicial body to either replace the company's current board, or appoint a retired Supreme Court judge as non-executive chairman.

Mistry ratcheted up his battle versus the $100 billion salt-to-software conglomerate by filing a petition with the National Company Law Tribunal (NCLT) on Tuesday.

The complaint levels allegations on mismanagement and corporate governance failures within the company, while also seeking to restrain Tata Sons from issuing any new equity or altering its articles of association, according to a copy of the petition seen by Reuters on Wednesday.

After resigning from the boards of listed Tata entities on Monday, Mistry vowed to keep up the fight to improve governance norms in the nearly 150-year-old conglomerate.

Mistry's petition alleges that Tata Sons abused its articles of association by "protecting the legacy left behind" by Ratan Tata, by continuing to invest in its "doomed Nano car project" and continuing to stick by its loss-making European assets that were acquired under Tata's watch before he retired in 2012.

Tata has returned as interim chairman of Tata Sons following Mistry's ouster as chairman in October.

Mistry has filed his claims under section 241 and 242 of the Companies Act of 2013 that deal with shareholder oppression and mismanagement.

Mistry's Shapoorji Pallonji family own a roughly 18 percent stake in Tata Sons, with Tata Trusts - a cluster of public charities - owning a controlling 66 percent stake in the holding company. The Trusts are currently chaired by Tata.   Continued...

 
Tata Group Chairman Cyrus Mistry speaks to shareholders during the Tata Consultancy Services (TCS) annual general meeting in Mumbai, India June 28, 2013. REUTERS/Vivek Prakash/File Photo