Shareholders of Indian Hotels Company Ltd. (IHCL) expressed concern over former Tata Sons Chairman Cyrus Mistry’s decision to take legal recourse to fight his rivals in the Tata Group.
Though Mr. Mistry’s resignation from all group companies has allayed concerns about a protracted boardroom tussle, shareholders said a legal battle would have an adverse impact on the group and ultimately erode the value of their shares.
Mediation sought
They urged independent directors Deepak Parekh and Nadir Godrej to mediate between the Tata and Mistry families to bring about an amicable solution to the ongoing issue.
The shareholders were speaking at the Extraordinary General Meeting (EGM) of IHCL which was called to vote for a resolution for the removal of Mr. Mistry as director of the company.
IHCL, which owns and operates the Taj Group of hotels, on Tuesday conducted the EGM as per schedule but did not put the resolution to vote as he had already resigned as director a day earlier.
Chairing the EGM, IHCL MD & CEO Rakesh Sarna said: “The company was informed at 6.42 p.m. on Monday that Mr. Cyrus Mistry had resigned with immediate effect. Consequently the agenda of the meeting is rendered infructuous. No resolution will be considered and put to vote.” However, he allowed shareholders to express their views.
Thirty eight shareholders spoke on the occasion but none of them spoke in support of Mr. Mistry. Most shareholders praised Ratan Tata and justified his actions.
Four directors including Mr. Mistry's brother Shapoor Mistry did not attend the EGM. In the audience Tata Sons Interim Chairman Mr. Tata and his close confidants R.K. Krishna Kumar, N. Soonawala and Vijay Singh were seated till the end of the meeting.
Though the IHCL EGM remained a non- event, now the focus shifts to the EGMs of Tata Steel, Tata Motors and Tata Chemicals which will vote on a resolutions for removal of Nusli Wadia as Independent Director of the companies in the next three days. Since Mr. Mistry has resigned from all these companies, his removal will not come up for voting.
The Bombay High Court has provided some respite to Mr Wadia by directing the Tata companies to keep one board seat of an Independent Director vacant till further order irrespective of the outcome of the voting. Four minority shareholders have moved the Bombay High Court challenging the resolution of Tata Sons for removal of Mr. Wadia.
