Mistry family opposes Tata Sons plan to turn into private limited company

BT Online        Last Updated: September 15, 2017  | 18:24 IST
Mistry family opposes Tata Sons plan to turn into private limited company

As Tata Sons seeks investors' nod to change its status from a public limited company to a private limited one ahead of the annual general meeting (AGM) scheduled for September 21, Mistry family-owned Cyrus Investments Pvt. Ltd has written to Tata Sons objecting to the proposal to convert Tata group's holding company to a private limited company, calling it 'yet another weapon' to oppress minority shareholders, Livemint reported.

Tata Sons has sought shareholders' approval to amend its memorandum of association and articles of association to change Tata Sons to Tata Sons Private Limited. The proposed amendment will need the approval of 75 per cent of minority shareholders and a nod from the National Company Law Tribunal (NCLT).

Commenting on the rationale behind the move, a Tata Sons spokesperson said, "Tata Sons as a private company was considered by the board to be in its best interest."

Shapoorji Pallonji family-owned investment firms - Cyrus Investments and Sterling Investment - own 18.4 per cent in Tata Sons. Around 66 per cent of the Tata group holding company is owned by Tata Trusts. And the remaining 15.6 per cent of shares are held by the Tata family, some group companies and a few individuals.

The objection by Mistry family-owned investment firms comes after months of legal wrangle between two groups following Cyrus Mistry's removal as Chairman of salt-to-steel conglomerate.

Last month, Shapoorji Pallonji Group had said that any move by Tata Sons to cut business ties with the group will be 'insignificant' as Cyrus Mistry, during his tenure as the chairman of Tata Sons, had issued a directive in November 2013 to all Tata group companies to stop awarding new engineering and construction contracts to the Shapoorji Pallonji (SP) Group.

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