Shareholders of Tata Consultancy Services, the IT arm of Tata Group, met on Tuesday to decide fortunes of Cyrus Mistry as the director, and as expected, the board voted in majority against Mistry, ousting him from the list of directors. TCS is the second company of Tata Group after Tata Industries which has shown way to Cyrus Mistry after the controversial announcement of removing him as the chief of Tata Sons.
TCS is the most profitable company in Tata Group’s portfolio. On Tuesday, the directors of TCS met at Yashwantrao Chavan Center in South Mumbai to pass a resolution. However, Cyrus Mistry’s statement just before the meet stated that the meeting held very less importance as Tatas held 73% stake in the company.
LIC (Life Insurance Corporation), the biggest institutional investor in Tata Companies, did not take part in voting. It is being speculated that it could take a similar approach in the coming AGMs as well.
The AGM was attended by various veterans, which included a number of dignitaries in Tata Group. Interim chairman of Tata Sons, Ratan Tata also flew from Delhi to participate in the AGM. As the AGM proceeded, out of 39 individual shareholders, 35 spoke against Cyrus Mistry and remaining 4 spoke in favor, questioning the procedure to remove Cyrus Mistry.
5 more listed Tata Companies have called their AGMs in the coming weeks and removing Cyrus from the post of director remains one of the priority tasks. Seeing LIC keeping itself distanced from voting, it seems pretty easy that the resolution will be passed without much of a hassle. Tatas hold 30 – 40 percent of stakes in almost all other listed companies.