Five-page fireball

37Mistrysofficechair Mistry's office chair being removed from the office | Amey Mansabdar

On October 25, the day after his ouster as chairman of Tata Sons, Cyrus P. Mistry sent a five-page, 21-paragraph missive to directors of the company. The email originated at 22:05:41 IST from his official account. Copies were marked to trustees of Tata Trusts and to his own personal email account. The subject line said “Confidential”, and the mail was signed simply: “Sincerely, Cyrus”. Extracts:

ON HIS OUSTER: Calls the move “invalid and illegal”. Says the “board has not covered itself with glory”.

ABOUT THE BOARD: “Total lack of corporate governance”. Directors failed to “discharge the fiduciary duty owed to stakeholders”.

ABOUT BECOMING CHAIRMAN: “Politely declined” when Ratan Tata and Lord Bhattacharya approached him in 2011. Was assured of a free hand, but was “pushed into the position of a lame duck chairman”.

ON AMENDMENT OF ARTICLES OF ASSOCIATION: It “constrained the ability of the group to engineer the necessary turnaround” and “created alternative power centres without any accountability or responsibility....”

FOREIGN ACQUISITIONS: “With the exceptions of JLR and Tetley,” they left a “large debt overhang”. European steel business faces “potential impairments in excess of $10 billion”. “Many foreign properties of Indian Hotels Co. Ltd and holdings in Orient Hotels were sold at a loss”.

TELECOM INVESTMENTS: “Continuously haemorrhaging”. Cost of exiting business pegged at “$4-5 billion”, plus payout to DoCoMo.

TATA POWER: Regulation changes causes Tata Power losses of Rs 1,500 crore in 2013-14 alone.

TATA MOTORS: Says Tata Motors Finance “extended credit with lax risk assessment” to shore up sales and market share. This caused non-performing assets to touch Rs 4,000 crore. Criticises Nano project; says “product has consistently lost money, peaking at Rs 1,000 crore”. Says Ratan Tata has stake in a company to which the project supplies Nano gliders.

AVIATION: Highlights Ratan Tata's “passion for the airlines sector”. Critical of Air Asia deal; says his “pushback was hard, but futile”. Raises ethical concerns about Air Asia and about executive trustee Venkatraman.

POSITIVES: Says “operating cash flows of the group have grown at 31 per cent compounded per annum”. Tata Group valuation increased by 14.9 per cent between 2013-2016. Tata Sons net worth increased from Rs 26,000 crore to Rs 42,000 crore. Says Nomination and Remuneration Committee comprising Vijay Singh, Farida Khambata and Ronen Sen had “lauded and commended” his performance recently.

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