IHCL shareholders bat for Ratan

For Tata Group shareholders, the biggest fear now is the possibility of a long-drawn legal battle that will negatively impact group companies.

A number of shareholders at the EGM of Indian Hotels Company Ltd (IHCL) on Tuesday reposed faith in Ratan Tata, but expressed fear of an erosion of brand and market value of group companies.

“He should have done this long, long ago,” said shareholder Aloysius Mascarenhas, referring to Cyrus Mistry’s resignation as Chairman. Wishing Mistry would refrain from filing lawsuits, Mascarenhas said the tussle is impacting the Tata brand value.

Another shareholder, RN Batliwala, congratulated Ratan Tata for winning “half the battle” (Mistry’s resignation). He, however, wanted Mistry to keep off washing “dirty linen” in public.

On Monday, putting an abrupt end to an eight-week-long corporate battle, Mistry announced his resignation from all listed Tata companies. The resignation came ahead of many crucial Tata Group EGMs, starting with IHCL. Mistry, however, also announced his intention to fight the issue legally.

IHCL MD & CEO Rakesh Sarna chaired the EGM, while directors including Deepak Parekh, Mehernosh Kapadia and Nadir B Godrej were also present.

Interim Chairman Ratan Tata attended the meeting, along with Tata Trusts trustee RK Krishna Kumar and Sir Dorabji Tata Trust Managing Trustee R Venkataramanan.

A large number of shareholders echoed pro-Ratan sentiments. Former GIC Managing Director U Mahesh Rao, a vehement supporter of Ratan Tata, said Mistry lacks “maturity”, and this resulted in the boardroom tussle.

Several shareholders including Ashalata Maheshwari and Dinesh Bhatia praised Ratan Tata’s leadership and expressed happiness over Mistry’s exit.

Adil Polad Irani, the most vociferous Mistry supporter, said his earlier statements (at the TCS EGM) were against the chair and not aimed at a person.

At that EGM, Irani had sought reasons for Mistry’s removal, as the IT behemoth’s performance was much better during his tenure than previous years.

Earlier resolution Thirty-five shareholders aired their views at the EGM of IHCL, which owns the Taj Group of Hotels.

Though Mistry had resigned from the board of all Tata Group listed companies including IHCL, Tuesday’s EGM has to be conducted as a number of e-votes were already cast.

However, voting for the earlier proposed resolution (removal of Mistry as director) did not come up.

On November 4, independent directors of IHCL had expressed full confidence in Mistry as chairman, in seeming defiance of a move by Ratan Tata and Tata Sons to get him to step down.

However, there were few supporters for Mistry at today’s EGM.

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