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Business Insider IndiaCyrus Mistry will return as chairman of Tata Sons in four weeksBCCL
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Cyrus Mistry has been reappointed as the chairman of Tata Sons by the National Company Law Appellate Tribunal (NCLAT).
Mistry will return to the helm of the Tata conglomerate after a three-year-long battle in courts.
He was ousted in October 2016 being chairman for nearly four years.
Cyrus Mistry will be back at the helm of Tata Sons in another four weeks-- if no other legal hurdles stop him. After over three years spent battling in courts, Mistry’s removal as chairman was deemed illegal by the National Company Law Appellate Tribunal (NCLAT).
As Mistry returns to power, the current executive chairman of the company — N Chandra — might have to look for a new job.
Mistry served as Tata Sons chairman just shy of four years before the board removed him from the helm in October 2016. His net worth is currently at $10 billion.
Here’s a quick look at Mistry’s journey from being the son of a construction tycoon to leading Tata Sons a second time:
The youngest son of Tata Sons biggest shareholder
The Mistry family (Source: BCCL)
Mistry started out as the Managing Director of the Shapoorji Pallonji Group — an infrastructure conglomerate owned by his father, Pallonji Mistry. That was not the only thing that he handed over to his youngest son.
Mistry senior was also the largest shareholder in Tata Sons, granting him a seat on the boards of the company — a baton he passed onto Cyrus.
Though Cyrus Mistry has a strong educational background — a graduate of civil engineering from Imperial College of London and has a masters degree in management from the London Business School — many debate if it was his father’s credentials that did the trick.
Tipping point
Mistry, then deputy chairman of Tata Sons, with chairman Ratan Tata in 2011 (Source: BCCL)
In 2012, Cyrus Mistry was appointed as the chairman of Tata Sons. In addition to being at the head of the vast conglomerate, he was also CEO to Tata’s major subsidiaries — including Tata Steel, Tata Consultancy Services (TCS), Tata Motors, Indian Hotels, Tata Chemicals and others.
Half-Irish and half-Indian, Mistry was not just the sixth chairman of the group but also the second chairman who did not carry the Tata name, after Nowroji Saklatwala.
Till 2012, the unassuming Mistry was a relatively low-profile figure within India Inc circles, spending time with his wife Rohiqa, teenage sons - Firoz and Zahan - and his two dogs.
Luck runs out
Mistry after being appointed chairman of Tata Sons (Source: BCCL)
For the shy and reticent Mistry, the $5 billion dip in Tata’s value from $108 billion in 2015 to $103 billion in 2016, was an unkind cut. The company’s net debt was also on the rise from $23.4 billion in 2015 to $24.5 billion in 2016 — the further the company had ever been in the red.
In addition, Mistry was going around making changes in leadership across the various companies under Tata Sons umbrella. He also put a new council in place that consisted of members new to the company, wanting it to play a bigger role within the group. He was also evolving the role of these companies — like making Tata Chemicals more focused on consumer foods and Tata Steel going from a ‘materials’ company to a steadfast steel company.
The top it off, his decision to sell Tata steel's UK plant didn’t go down well, creating panic among employees and the British government.
Mistry after being ousted as chairman from Tata Sons (Source: BCCL)
The NCLAT’s decision to return the Tata Sons mantle to Mistry overturns the National Company Law Tribunal’s (NCLT) dismissal of earlier petitions by Cyrus Investments and Sterling Investments, which challenged his removal.
Mistry’s primary argument was that his removal as chairman violated the Companies Act — the only reason he was forced to leave was due to mismanagement of affairs across Tata Sons.
The NCLT, in turn, ruled that they could not find any evidence of mismanagement and the only reason he voted from power was because the board lost faith in him. They said that Mistry openly went against the board, and thus against the company as well.