Cyrus Mistry writes to Tata Group’s board members; criticizes his removal, calls board proceedings as illegal

Cyrus Mistry, who was removed as Tata Sons Chairman, in an email to the board members, slammed the decision to terminate him and called the board meeting as invalid and illegal.

In his e-mail, Mistry wrote he was shocked beyond words and said the decision was “unparalleled in the annals of corporate history.”

"I have to say that the board of directors has not covered itself with glory. To ‘replace, your chairman without so much as a word of explanation and without affording him an opportunity to defend himself...must be unique in the annals of corporate history’,” Mistry said in the email.

Mistry accused the top management of now allowing him to manage the affairs of the sprawling Tata Group freely.

"The sudden action and lack of explanation has led to all manner of speculation and has done my and the group's reputation immeasurable harm. The letter is to emphasise the total lack of corporate governance and a failure of the directors to discharge their fiduciary duty to stakeholders of Tata Sons and the group companies,” Mistry alleged.

Mistry was removed as the Chairman following his ability to handle the leadership role. Ratan Tata has been appointed as an interim Chairman for four months.

However, Mistry slammed all allegations of his lacking a corporate strategy. Mistry pointed out he had presented the strategy 2025 to the Tata Sons board.

Also, Mistry said he had initially declined the offer made by Ratan Tata and Lord Bhattacharyya to head the group but lack of candidates pushed him to take up the offer after he was assured a free hand with Ratan Tata stepping back but being there to advise and guide him.

But this did not happen. Instead after the appointment, the Tata Trusts amended the articles of association, changing the terms of engagement between Trusts, Tata Sons board and the chairman, which severely constrained his ability to engineer a turnaround.

In the email to the board, Mistry had said that the group's foray into aviation by way of joint ventures with Air Asia and Singapore Airlines was at the behest of Tata. In both cases he had been presented with a fait accompli.

He said that IHCL's acquisition of the Sea Rock property in Mumbai pushed the company to write down nearly its entire net worth over the past 3 years, impairing its ability to pay dividend, while Tata Capital had enormous non-performing assets on account of loans to Southbased businessman Sivasankaran.

He said the telecom business was continuously haemorrhaging and a shutdown or a fire sale would have cost anywhere between $4 billion and $5 billion, in addition to a $1-billion payment to partner Docomo.