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When the Tatas had no money to pay Pallonji family

Cyrus Mistry's removal as the Chairman of Tata Sons' has cast a shadow on the ties between the two families. While the Tatas have always had a commanding presence, Pallonji family has maintained a low profile and mostly stayed away from spotlight.

BT Online | October 29, 2016 | Updated 09:46 IST
When the Tatas had no money to pay Pallonji family

The relationship between Mumbai's two oldest business families - Tatas and Mistrys- has been in public domain for years. However, very little is known about the times when these two families helped each other in moments of crisis.

Pallonji Group's association with Tata Group started in 1936 when Shapoorji Pallonji Mistry bought 17.5 per cent of Tatas' main holding company, Tata Sons. To this day, the promoters of the Pallonji Group are the largest individual shareholders in Tata Sons.

In an interview to India Today in 2012, HDFC Chairman Deepak Parekh mentioned how Pallonji's father built factories for Tata Motors and Tata Steel.

"Pallonji's father built factories for Tata Motors and Tata Steel. The Tatas had no money to pay for them so they gave him shares instead," he had said.

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Cyrus Mistry's removal as the Chairman of Tata Sons' has cast a shadow on the ties between the two families. While the Tatas have always had a commanding presence, Pallonji family has maintained a low profile and mostly stayed away from spotlight.

The Shapoorji Pallonji Group is an Indian conglomerate with businesses in construction, real estate, textiles, engineering goods, home appliances, shipping, publications, power, and biotechnology.

The companies under SPG include Shapoorji Pallonji Engineering and Construction, Afcons Infrastructure, Forbes Textiles, Gokak Textiles, Eureka Forbes, Forbes and Co, SP Construction Materials Group, SP Real Estate and Next Gen among others.

The company was founded in 1865 as a partnership firm Littlewood Pallonji. Group's first project was the construction of a pavement on the Girgaum Chowpatty, followed by being part of the construction of a reservoir on Malabar Hill which supplied water to Mumbai for over 100 years.

ALSO READ: Here's a brief history of the Tata Group's six chairmen

In 2012, Forbes estimated Pallonji S Mistry's wealth to be Rs 53,350 crore, making him the wealthiest person of Parsi descent as well as the richest Irishman in the world. Pallonji Shapoorji Mistry is considered to be the world's most reclusive billionaire.

Pallonji Group controls little over 18 per cent stake in Tata Sons, the holding company of the $103 billion Tata Group, making the Mistrys the largest individual shareholders in India's 140-year-old conglomerate.

What is not known by many is the fact that Pallonji Group built some of India's most iconic buildings- The Taj Mahal Palace and Towers and The Oberoi Hotel, both of which were attacked by terrorists in 2008. The Group was also involved in the repairs and renovation of Taj Mahal Palace and Tower which was severely damaged by the attack.

The Group is known for building some of Mumbai's landmarks around the Fort area, including the Hong Kong Bank, Grindlays Bank, Standard Chartered Bank and Reserve Bank of India building, Bombay Stock Exchange building and Taj Intercontinental.

ALSO READ: Board's move unparalleled in corporate history, says 'shocked' Cyrus Mistry

Apart from these, the company has built a stone palace for the Sultan of Oman in 1971 and the president's palace in Ghana. Its overseas projects include notable Lake Towers in Dubai, Ebene Cyber City in Mauritius and Providence Stadium in Guyana.

The Group also built the Brabourne stadium in Mumbai and the Jawaharlal Nehru stadium in Delhi. The Mumbai Central Railway station was also built by the Pallonji Group. The company was commended by the then Governor of Bombay for completing the work within 21 months.

In recent years, the Group built Barakhamba Underground Station in Delhi and India's tallest building - The Imperial, a residential tower, in Mumbai in 2010.

In 2012, Shapoor Mistry announced that the Group had plans to invest in a deep-sea port, an IT park, hydro electricity and construction of roads and night shelters for the poor in West Bengal.

 

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