The Supreme Court on Wednesday adjourned the hearing in the Tata-Mistry dispute case for a week. The investment firms - Cyrus Investment and Sterling Investment - requested the apex court to adjourn hearing as the advocate on record was unwell.
The CJI-led bench of Supreme Court was slated to hear plea by the two investment firms for separation from Tata Sons as part of additional relief in its minority oppression case. The apex court was also expected to take up Shapoorji Pallonji Group's (SP Group) proposal to settle the dispute.
In its petition to the Supreme Court, Shapoorji Pallonji (SP) family on October 29 had submitted to end its seven decades-old tie with the Tata Group. It proposed that its share of the Tata brand and of unlisted group companies be settled in cash or in marketable securities. The SP Group has quoted Rs 1.75 lakh crore as the value of their 18.37 per cent stake in Tata Sons. However, the Tata Group has disputed this valuation.
The SP family said the disputes over valuation can be eliminated by doing a pro-rata split of listed assets (share price value is known) and pro-rata share of the brand (brand valuation already done by Tata and published). A neutral third-party valuation can be done for the unlisted assets adjusted for net debt (i.e. debt less cash).
As a non-cash settlement, SP Group can be given pro-rata shares in listed entities of the Tata Group where Tata Sons currently owns stake, they said. For example, 72 per cent of Tata Consultancy Services Ltd. (TCS) is owned by Tata Sons. The SP Group's holding in Tata Sons translates to 13.22 per cent of TCS at current market prices, the SP Group has said.
In unlisted companies, the group wants an agreement on valuation with the Tata Group with the settlement for its 18.37 per cent stake in Tata Sons done on cash or marketable securities. Similarly, a pro-rata share of the Tata brand value can be settled in cash or in listed securities, the group has said. The brand value can be determined on the basis of a report by Brand Finance.