Shapoorji PallonJi’s stake in Tata Sons does not exceed Rs 80,000 crore: Salve
Shapoorji Pallonji Group’s 18.4% stake in Tata Sons does not exceed Rs 80,000 crore. This was stated in the Supreme Court by Senior Advocate Harish Salve, appearing for Tata in the trial of Cyrus Mistry and Tata Sons. The Mistry Group had earlier claimed the value of its stake in Tata Sons to be more than Rs 1.75 lakh crore.
SP group may get a big difference in valuation: Such a huge difference in valuation can indeed be very heavy for the SP group struggling with a cash shortage. SP and Tata Group are under litigation after Mistry was removed from the post of Tata Group chairman in 2016. Tata Sons is said to have offered the SP group to buy its stake in the holding company to repay the debt.
SP group submitted a separation plan on 29 October: The SP Group submitted a separation plan to the Supreme Court on October 29 to break the seven-decade relationship with the Tata group. In the separation plan, the SP Group had asked for shares of all Tata Group listed companies in which Tata Sons has a stake for non-cash settlement. For this, it was sought to base the distribution on the proportion of the listed assets (based on share price value) and the brand (according to the publication of valuations done by Tata). Cyrus had also demanded to be reinstated as the chairperson of Tata Sons.
Mistry can complain of dismissal in private: Bar and Bench quoted Senior Advocate Harish Salve as saying, “Mistry was not appointed as executive chairman of the minority shareholder. Anyway, Mistry can complain privately (of his dismissal), not the minority shareholders. .
Mistry was the executive chairman appointment only till March 2017.
Salve said Mistry’s appointment as executive chairman was only until March 2017, not for a lifetime. With this plea, he referred to no member of the Tata Sons board between 1965 and 1980. Cyrus ‘father Pallonji Mistry was made a non-executive director on Tata Sons’ board in 1980, while Cyrus joined Tata Sons in 2006.
Salve argued: Mistry was given a designation, not a post
Salve said Mistry was given a designation, not a post. “Many times companies do not have an executive chairman and only the most senior directors preside over the board,” he said. He also said that with 18% in normal corporate democracy, Mistry could not get a single director’s place on the board and the board would be filled with a nominee of 68% of stakeholders.
NCLAT ordered the reinstatement of Mistry on 18 December 2019
The Company Law Appellate Tribunal (NCLAT), in its order on 18 December 2019, ordered Cyrus Mistry to be made the chairman of Tata Sons, against which the Tata Sons moved to the Supreme Court. Subsequently, the Supreme Court stayed the order of NCLAT on 10 January 2020.
