“The Shapoorji Pallonji-Tata relationship spanning over 70 years, was forged on mutual trust, good faith, and friendship,” the group said in its statement.
On Tuesday, Shapoorji Pallonji Group said it’s time to exit from Tata Sons after a relationship that spanned 70 years turned sour in the last few years, Mint reported.
“The Shapoorji Pallonji-Tata relationship spanning over 70 years, was forged on mutual trust, good faith, and friendship,” the group said in its statement.
“Today, Shapoorji Pallonji Group stated before the Supreme Court that separation from Tata Group is necessary due to potential impact this continuing litigation could have on livelihoods and the economy,” the company further added.
“It is with a heavy heart that the Mistry family believes that a separation of interests would best serve all stakeholder groups,” the group said in a press statement.
This simply means that the SP group, which holds 18.4% stake in Tata Sons through its two investment firms, has agreed to sell its stake and move out of the company.
This statement comes after a long legal battle which started in December 2016 after Cyrus Mistry was removed as Chairman of Tata Sons in October 2016.
Ever since Mistry’s sacking, the SP group said, Tata Sons has been aking “value destructive business decisions”.
“It is extremely unfortunate that the current leadership of Tata Sons has not only continued to take value destructive business decisions in a misguided effort to prove a point in these proceedings. It is a matter of public record that several issues identified years earlier, continue to plague the group. Be it the operations of Tata Steel UK, where over the last three years alone the operational losses have increased by an additional 11,000 crores, or the Group’s aviation businesses.”
“These actions, or lack thereof, have meant that the total debt in the major Tata group companies has increased by approximately ₹100,000 crores in the last three years. Excluding TCS, the last quarters losses of all the listed group companies of approximately 14,000 crores causes great concern. Unfortunately, the impact of these actions continue to hurt minority shareholders, be it the SP Group at Tata Sons or the millions of shareholders of the listed companies in the Tata Group,” the SP group said.
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