Setback to Tatas: Indian Hotels board backs Mistry as chairman

RSTV Bureau
File photo of Ratan Tata with Cyrus Mistry, the ousted chairman of Tata Sons.

File photo of Ratan Tata with Cyrus Mistry, the ousted chairman of Tata Sons.

Ousted Tata Sons chairman Cyrus Mistry today received a major boost, with the board of directors of the group’s hospitality arm Indian Hotels Co Ltd unanimously supporting his leadership and continuance as chairman of the company.

While the independent directors of Indian Hotels Co Ltd (IHCL) endorsed Mistry’s leadership and expressed their ‘unanimous’ full confidence in him at a meeting just before the board of the company that runs Taj Group of Hotels met, sources said other members of the board supported him later.

“There was unanimous support by the board members to Mistry and his continuance as chairman of the company,” a source in the know said.

Just as independent directors of the firm, including banker Deepak Parekh and Nadir Godrej, met ahead of a scheduled board meeting, Tata security personnel roughed up journalists and lensmen gathered outside Bombay House to report the meetings.

After ousting Mistry from Tata Sons – the holding company of 100-odd firms with India’s largest conglomerate, the promoter Tata Trust is looking at removing him from the operating companies as well.

The vote of confidence by the board of IHCL is a boost to Mistry. The board of Tata Chemicals is scheduled to meet on November 10 to consider second quarter results and Tata Motors will do so on November 14.

In a BSE filing, IHCL said: “The independent directors unanimously expressed their full confidence in Chairman Cyrus Mistry and praised steps taken by him in providing strategic direction and leadership to the company.”

The other independent directors of IHCL include Gautam Banerjee (of Blackstone Group), Keki Dadiseth (ex-HUL MD), Vibha Rishi Paul (former executive director, brand and human capital, Max India) and Ireena Vittal (former partner with McKinsey & Co).

Besides Mistry, his sibling Shapoor Mistry is a director on the board of IHCL, as also his confidant and CEO Rakesh K Sarna.

Ratan Tata-led interim management of Tata Sons is seeking to oust Mistry from his positions in the operating group firms, including IHCL and Tata Motors.

As on September 30, 2016, the promoter group controls 38.65 per cent stake in IHCL, out of which Tata Sons has 28.01 per cent.