Tata Sons’ move to cut off all ties with Cyrus Mistry’s Shapoorji Pallonji Group (SP Group) will not have any impact, given that engineering and construction contracts from Tata to the latter fell to zero in financial year 2016.
Even up until FY 2013, the SP Group had ₹1,125 crore in order bookings from Tata projects, the highest level in the past seven years.
However, it fell to ₹103 crore in FY 2014, to a meagre ₹4 crore in FY 2015 and further to zero in FY 2016. Even as of October 2016, there were no order bookings.
“SP Group is a $5-billion conglomerate with business across 40 countries. Mistry had, when he was Chairman of Tata Sons, issued a directive in November 2013 to all Tata group companies to ensure that no new engineering and construction contracts were awarded to the SP Group, during his tenure,” an official statement from SP Group said.
“Any residual orders pending is extremely insignificant in value for SP Group,” it added.
The Mistry camp was reacting to media reports that said Tata Group had decided to terminate all business dealings with the SP Group, following “disparaging” statements made against Tata Sons by Cyrus Mistry and his associates.
SP Group is currently run by Tata Sons’ ousted chairman Cyrus Mistry and his brother Shapoor Mistry. Cyrus Mistry was ousted from Tata Sons in October 2016 following a boardroom battle, which was followed by a number of cases in Mumbai and Delhi.
At present, the issue is being heard by the National Company Law Appellate Tribunal (NCLAT). The Mistry family is the single largest shareholder in Tata Sons, with an 18.4 per cent stake.
Order bookings from Tata projects fell to ₹103 crore in FY 2014, to a meagre ₹4 crore in FY 2015 and further to zero in FY 2016. As of October 2016, there were no order bookings.