India: Management Indian Industrial Behemoth Tata Sacks Chairman Mistry, Ratan Tata Makes Return
In a dramatic development that took corporates and others by surprise, Cyrus Mistry was recently sacked as Chairman of Tata Sons and was replaced by Ratan Tata, from whom he had taken over the reins of the over $100 billion salt-to-software conglomerate four years ago.
Mumbai/India – The surprise announcement came after the Board of Tata Sons met and decided to replace 48-year-old Mistry and appoint Ratan Tata, 78, as interim head. The board named a five-member search committee, which includes Tata, to choose a successor to Mistry within four months.
Mistry was chosen as Tata’s successor in November, 2011, and was appointed Deputy Chairman of Tata Sons, whose board he had entered in 2006. He was made chairman on the basis of his representation from Shapoorji Palonji, the largest shareholder in Tata Sons.
There were no reasons given for the change of leadership of the man who was brought in with much fanfare but it is believed that Tata Sons was unhappy with Mistry’s approach of shedding non-profit businesses, including the conglomerate’s steel business in Europe, and concentrating only on cash cows.
Tata Sons is the main holding company of the group. The board constituted a selection committee comprising Tata, TVS Group head Venu Srinivasan, Amit Chandra of Bain Capital, former diplomat Ronen Sen and Lord Kumar Bhattacharya. All of them, except Bhattacharya, are on the board of Tata Sons.
“The committee has been mandated to complete the selection process in four months,” it added.
The Tata Group comprises a significant scale including Tata Steel, Tata Motors, Tata Consultancy Services, Tata Power, Tata Chemicals, Tata Global Beverages, Tata Teleservices, Titan, Tata Communications and Indian Hotels.