Ratan Tata as interim after cyrus mistry

Apart from the fanfare brought globally by Cyrus Mistry for the Tata Sons Groups,the decision of disbanding of Mistry from the Chairman position took everyone by surprise.

Everyone is thinking What might be the reasons for Ratan Tata entry as the interim head?

A committee has been set for the decision for removing Cyrus Mistry from his chair since two months. It all ended up when the majority of the Board members in the meeting had voted for disposal of Cyrus Mistry.

The official announcement came out on Monday afternoon. Mistry was selected as the successor of Tata’s Group in November 2011. In the initial stage, he acted as the Deputy Chairman and later he was made as the Chairman for his affiliation with Shapoorji Pallonji.

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It is believed that the core reason for the ouster of Cyrus Mistry was his inefficient approach and declining performance of shedding non-profit businesses. And Mistry was blamed for concentrating only on the Cash cows.

The other reasons were the style of functioning when compared with Ratan Tata. As under Ratan Tata’s Chairmanship the company has driven its expansionist strategy which included overseas purchases like Tetley in 2000 and with the Jaguar Land Rover luxury car in 2008. On the other hand under Mistry 4-year Chairmanship focused more on tackling the mounting debt by raising cash-flows.

The other additional reasons for the firing of Mistry were his functioning style and denying of Ratan Tata’s bits of advice on some crucial matters. The ignoring of pieces of advice had resulted in the loss and created legal problems with Japan’s DoCoMo.

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A group spokesperson said, “The Tata Sons board in its collective wisdom and on the recommendation of principal shareholder decided that it may be appropriate to consider a change for the long term interest of Tata Sons and the Tata group.”

As of now, it is believed that there will be a legal battle between Tata Sons and Cyrus Mistry. Tata Sons had already hired senior lawyers Abhishek Manu Singhvi and Harish Salve for future consequences.