Mistry to chair IHCL board meet on Friday

He had raised questions about sale of overseas properties of Indian Hotels, Orient Hotels at a loss

November 04, 2016 01:20 am | Updated December 02, 2016 01:14 pm IST - MUMBAI:

Ousted Tata Sons Chairman Cyrus Mistry is set to chair the board meeting of Indian Hotels Company (IHCL), a Tata Group firm, at Bombay House, the corporate headquarters of the group, on Friday.

The meeting may be crucial given that the board members include Cyrus Mistry as chairman, his elder brother Shapoor Mistry, Industry veteran and HDFC Chairman Deepak Parekh and Godrej Industries Managing Director Nadir Godrej.

The other members include Keki Bomi Dadiseth, Ms. Ireena Vittal, Ms. Vibha Paul Rishi, Mr. Gautam Banerjee, Mr. Rakesh Sarna (Managing Director and CEO) and Mr. Mehernosh S. Kapadia (Executive Director – Corporate Affairs).

Troubled legacy?

In a letter to Tata Sons board last week, Mr. Mistry had raised questions about selling overseas properties of Indian Hotels and Orient Hotels at a loss. “The onerous terms of the lease for Pierre in New York are such that it would make it a challenge to exit. IHCL, beyond flawed international strategy, has acquired the Searock property at a highly inflated price and housed in an off-balance sheet structure. In the process of unravelling this legacy, IHCL has had to write down its entire net worth over the past three years,” said Mr. Mistry adding that this impaired its ability to pay dividends.

“There is no reason why he should not attend the Indian Hotels board meeting on Friday,” according to a source in the Mistry camp.

“He is still the chairman and there will be business as usual at the board meeting to announce the second quarter results of the company,” the source said.

Tata sources also confirmed that the Indian Hotels board meeting is to be chaired by Mr. Mistry. Mr. Mistry had dispelled speculation last week that he would resign from the chairmanships of all group companies by attending the board meeting of Tata Global Beverages last week.

When asked if it would be embarrassment for Tata Sons, a Tata source said, “He is director on the board of Indian Hotels and chairman at this point of the time, so he can attend the board meeting.”

In the board meeting of Tata Global Beverages, discussions centred around the company’s operations and there were questions by any board members about Mr. Mistry’s dismissal as Tata Sons chairman.

Mr. Mistry will also chair the Tata Chemicals board meeting on November 10. That company’s board comprises Nusli Wadia (said to be a good friend of Mr.Ratan Tata), Nasser Munjee, YSP Thorat, Vibha Paul Rishi, Bhaskar Bhat and R.Mukundan.

Other board meetings to be held in the coming days, with Mr. Mistry chairing them, include Tata Steel, Tata Motors and Tata Power. Analysts are closely watching developments as to how long Mr. Mistry would continue as the chairman of the Tata Group firms, mainly at the four big listed firms — TCS, Tata Steel, Tata Motors and Tata Chemicals.

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