Tuesday, Mar 21, 2023 | Last Update : 12:57 PM IST

  Business   In Other News  21 Nov 2016  TCS alleges Cyrus Mistry caused enormous harm

TCS alleges Cyrus Mistry caused enormous harm

Published : Nov 21, 2016, 5:56 pm IST
Updated : Nov 21, 2016, 5:57 pm IST

TCS said Mistry had "lost confidence" of Tata Sons the company's largest shareholder.

 Ousted Chairman of Tata Sons, Cyrus Mistry.
  Ousted Chairman of Tata Sons, Cyrus Mistry.

New Delhi: Upping the ante, Tata Consultancy Services (TCS) today charged its estranged chairman Cyrus Mistry with causing "enormous harm" to the company by his conduct and sought his removal from the company board.

In a notice to shareholders seeking his removal, India's largest software exporter said Mistry had "lost confidence" of Tata Sons — the company's largest shareholder and holding company of the USD 103-billion Tata Group.

It went on to cite benefits accruing to it from use of 'Tata' brand by Ratan Tata-led Tata Sons to back its recommendation for Mistry's removal.

Within weeks of Ratan Tata replacing Mistry as Chairman of the holding company of the group, Tata Sons by virtue of its commanding 73.26 per cent stake in TCS removed him as the chairman.

It also asked the company to convene an extraordinary general meeting (EGM) of shareholders to consider removing him as a director on the board.

At its board meeting last week, which was not attended by Mistry, TCS decided to call an EGM on December 13. In the EGM notice, TCS said, "Subsequent to his replacement as Executive Chairman of Tata Sons Ltd (TSL), Mistry has made certain unsubstantiated allegations, which cast aspersions not only on TSL and its board of directors, but also on the Tata group as a whole, of which TCS is an integral part."

Stating that the communication marked as confidential "was made public", TCS said: "Mistry's conduct has caused enormous harm to the Tata Group, TCS and its stakeholders, including employees and shareholders."

The move by TSL to replace Mistry with group veteran Ishaat Hussain as chairman of TCS was seen as an attempt by Ratan Tata-led promoter group to tighten grip over the salt-to-software conglomerate.

"The board of directors of the company is in agreement with... the removal of Cyrus P Mistry as director of the company, as the same would be in the best interests of the company," it said.

"The board of directors of Tata Sons, the holding company of the Tata Group, has "lost confidence in Cyrus P Mistry to lead Tata Sons for a combination of several factors," it said, adding that Tata Sons on October 24 decided to replace him as the removal "was absolutely necessary for the future success of the Tata Group".

Tags: cyrus mistry, tata sons, ratan tata, tata consultancy service
Location: India, Delhi, New Delhi