TNN | Nov 23, 2011, 06.11PM IST
“The board of directors of Tata Sons at its meeting today appointed Cyrus P Mistry as the deputy chairman. He will work with Ratan N Tata over the next year and take over from him when Tata retires in December 2012,” Tata Sons said in a statement.
This is as per the unanimous recommendation of the selection committee, it added.
Shapoorji Pallonji Group holds 18 per cent stake in Tata Sons.
Commenting on the appointment, Ratan N Tata, Chairman of Tata Sons, said: “The appointment of Cyrus P Mistry as Deputy Chairman of Tata Sons is a good and far-sighted choice.
“He has been on the Board of Tata Sons since August 2006 and I have been impressed with the quality and calibre of his participation, his astute observations and his humility.”
Tata further said: “I will be committed to working with him over the next year to give him the exposure, the involvement and the operating experience to equip him to undertake the full responsibility of the Group on my retirement.”
Born on July 4, 1968, Mistry graduated from the Imperial College, London with a BE in civil engineering. He also holds a masters degree in management from the London Business School, and is a fellow of the Institution of Civil Engineers. Apart from the Tata Group, he also serves as a director on the board of several other companies, including Shapoorji Pallonji & Co, Forbes Gokak, Afcons Infrastructure and United Motors (India). At 38, he was one of the youngest directors of the company, set up as a trading firm in 1868.
The Mistry family continues to hold a valuable 18% stake in Tata Sons and Pallonji Mistry has been board member for a long time. His father Shapoorji Pallonji Mistry bought 12.5% from the FE Dinshaw Estate some time in the 1930. He later acquired more stake from other Tata family members, taking his holding to about 16.5%.
JRD Tata, who was appointed Tata group chairman in 1938, was incensed. But cooler heads prevailed and the two families decided to let the matter subside and maintain a cordial relationship. Pallonji Mistry, who took over from his father in the 1970s, built on that and his daughter Aloo Mistry’s marriage to Noel Tata, Mr Ratan Tata’s step-brother, seemed to indicate that relations were on a normal level.
Pallonji Mistry’s family is the biggest non-Tata shareholder in Tata Sons. In the early 1990s, he invested over Rs 60 crore of his own money in the Tata Sons rights issue to maintain his stake in the company. The other major shareholders of Tata Sons are the Tata Trusts and some of the Tata group companies.
Cyrus Mistry’s appointment ends a long suspense over who will take Pallonji Mistry’s position on the board. The elderly, soft-spoken construction magnate had wanted one of his sons to be nominated, but the Tata group and Ratan Tata in particular had not taken a decision on it for a long time.
In ’05, Ratan Tata told a business daily that “Mr Mistry has no right of nomination. If there were a member of the Mistry family that comes on the board, it would be to represent the shareholding – if we chose to make that happen. Mr Mistry himself came on the board, we recognised him as the largest shareholder (of Tata Sons). (Inputs from PTI)