C. Sivasankaran of the Siva Group has said the money lent to him by Tata Capital was against a pledge created on shares held by him in Tata Teleservices Ltd. (TTSL), and accused former Tata Sons chairman Cyrus Mistry of not being transparent and unnecessarily dragging him into a controversy by citing a loan given to him.
“They have given Rs. 200 crore against Rs. 600 crore worth of TTSL shares,” Mr. Sivasankaran said on Thursday, when asked for his reaction to the reference made to him in Mr. Mistry’s letter to the Tata Sons board.
The loan was availed of by him in June 2012 in two tranches, after he offered 6.22 crore TTSL shares as security. The valuation of the TTSL shares was based on an estimate by “our Chennai valuer GPDB & Co in June 2012 at Rs. 120 a share,” Mr. Sivasankaran said.
The first tranche was Rs. 130 crore (the loan agreement was dated June 7, 2012) and the second Rs. 70 crore (loan agreement was dated March 30, 2012).
The Chennai-based Siva Group’s founder said he hadn’t repaid the loan since he had filed for a bankruptcy. “They have written it off in their books of accounts and kept the shares with them,” he added.
Mr. Mistry, who was removed as Chairman of Tata Sons in an abrupt development this week, had levelled a series of allegations against his predecessor Ratan Tata, and said Mr. Tata’s interference in the running of the group’s businesses had put him in the position of a “lame duck Chairman.”
“Tata Capital had a book that required significant clean up on account of bad loans,” Mr. Mistry had written. The loan to “Siva” had been made under the strong advice of an Executive Trustee which had since turned into a non-performing asset, Mr. Mistry had said. Mr. Sivasankaran said he had been the only non-Tata person to hold shares in the company then. Asserting that his friendship with Mr. Tata was based on trust, Mr. Sivasankaran said Mr. Mistry “is not transparent.”
Lashing out at the ousted Tata chief he said, TTSL had not been doing well for 16 quarters. “What did he (Mr. Mistry) do? Did he sack anyone for non-performance?” Mr. Sivasankaran asked.
If the value of the shares had dropped in the meantime, the blame should rest with Mr. Mistry, he said. “I am suffering loss because of the mismanagement,” he added. “I could have put the money in real estate or anywhere and earned much more.” Mr. Sivasankaran hinted that he could seek legal redress for the loss of value of his investment.
