It’s 3-0 as Tata Tele shows Mistry the door

Shareholders of the unlisted Tata Teleservices Ltd (TTSL) on Wednesday showed Cyrus Mistry the door at an extraordinary general meeting, making it the third Tata Group firm to remove him as director.

The outcome was inevitable, given that Tata Tele is nearly fully owned by Tata Group entities, including Tata Sons, Tata Power and Tata Communications.

This could, however, be the last Tata company where Mistry’s ouster from the board was a certainty. The upcoming EGMs of Tata Motors, Tata Steel and Tata Chemicals, where the Tatas hold only between 30-40 per cent stake, could see more polarised voting.

The outcome of the Tata Tele EGM, held at Bombay House, the Group’s headquarters, follows the two earlier EGMs of Tata Industries and TCS, where too the shareholders voted to remove Mistry. On Wedneday, TTSL shareholders unanimously passed the resolution to remove Mistry as director.

Tata Sons holds a 36.17 per cent stake in TTSL, which has a listed entity — Tata Teleservices (Maharashtra) — as its subsidiary.

Japanese telecom major NTT DoCoMo, which is locked in a legal battle with its Indian joint venture partner TTSL, holds 26.5 per cent in the company.

Tata Communications (9.33 per cent), Tata Power (6.97 per cent), Tata Industries (5.46 per cent), Tata Steel (1.37 per cent) and Tata Capital Financial Services (1.32 per cent) are the other shareholders in the firm.

The minority shareholders include Aranda Investments (Mauritius) (6.45 per cent), Telecom Investments (Mauritius (1.68 per cent), IL&FS Trust Company (1.67 per cent), 2i Capital PCC (1.02 per cent) and Siva Industries and Holdings (0.63 per cent). While Siva is known to be close to the Tata Group, it is not clear how the other minority shareholders voted.

Mistry, who had chaired a TTSL board meeting on November 7, did not attend the EGM. However, many of the other board members, including representatives from Japan’s NTT DoCoMo, were present.

TTSL Managing Director N Srinath and Chairman Kishor Chaukar were present, sources told BusinessLine .

In response to the TTSL shareholders’ vote, sources close to Mistry said the outcome came as no surprise.

“Tata Teleservices, like TCS, has a super majority ownership by the Tata Group currently under the control of Ratan Tata. This outcome was foregone. Being a closely held company, the outcome isn't surprising at all,” the sources added.