Tata Sons with all fanfare
introduced Mr. Cyrus Mistry in 2012 as Chairman of Tata Sons. The previous
chairman Mr. Ratan Tata broaden Tata Group reach on global footprint with
series of acquisition through Tata Steel, Tata Motors, Tata Global Beverages,
Tata Communications and above of all Tata Consultancy System exponential growth.
Tata Sons is known for their focus on Society welfare more than their
profitability and expected the same from Mr. Cyrus Mistry.
Post taking the responsibility,
Mr. Cyrus Mistry turned the focus in getting rid of loss making companies or
subsidiary of any company. He also got entangled with DoCoMo on their attempt
to exit from Tata Telecom service venture. The recession in metal sector brought
unprecedented challenges to Tata Steel. Tata Steel sold out part of their Steel
business in UK and also threatened to go for fire sell of remaining units in UK
but later retracted from their decision.
Tata Motor faced declining market
share in domestic market whereas Jaguar-Land Rovers combination filled loss
funnel of Tata Motors with Millions of $ of profitability. Tata Communications
pulled out of South Africa market and many more exit. At the same time Tata
Sons entered into Airline business.
Out of the blue moon Tata Sons
removed Mr. Cyrus Mistry from the position of Chairman of Tata Sons without
giving any reason for the same. The decision turned bear's active in the equity
market and group companies share went for major selloff. The response initiated
by Mr. Cyrus Mistry using media as communication escalated the situation between
Tata Sons and Mr. Cyrus Mistry. The support of Independent director for Mr.
Cyrus Mistry to be Chairman of Tata Chemicals board forced Tata Sons to
initiate the process of calling EGM in order to remove Mr. Cyrus Mistry from
the board of Tata Companies where Mr. Mistry is Chairman. Claims & Counter
Claims even forced regulators to keep their eye opened on all happenings.
As battle continues; most of the
Tata Sons controlled listed Tata Companies lost 15-20% in Stock market. Being
one of the most trusted brand worldwide, many investors invested in companies
debt, shares as well as active in Future & Option. For big FII's, DII's ;
it's easy to control their investment given expertise and financial muscle they
carry. The major damage happened to common investors invested in F&O as
well as equities with short to medium term view. The continuous fall in listed
companies share prices coupled with very high volatility in the market place inflicted
major financial losses to small time investors.
Small time investors loves to
have capable management but more concerned about their investments. Who is
going to return their lost investment which occurred post sacking of Mr. Cyrus
Mistry followed by Mr. Cyrus Mistry move? I hope that the duel end at the
earliest and investor reaping good return from the left out investment.
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