Ratan Tata’s appointment as the interim chairman of the Tata Group does not signal well, says Mohandas Pai. In an interview to ET Now, soon after Tata Group made this surprise announcement, Mohandas Pai said, “I don’t think that bringing back Ratan Tata is a positive step”.
“It is worrisome for many investors who are following Tata Sons,” Pai said.
“I really don’t know why Cyrus Mistry resigned, he had got many changes in Tata Sons,” Pai added. Mohandas Pai went on to say, “It is difficult to change the course of such a big group. Tatas stood for high values and suddenly a chairman who was appointed 4 years back resigns, signals a worrisome story.”
In one of the biggest upheavals in the corporate sector, the Tata Sons Board has appointed Ratan Tata as the interim chairman of the group, replacing Cyrus Mistry. The decision was taken at a Board meeting today.
Mistry has resigned from his post as chairman. The Board has constituted a Selection Committee to choose a new Chairman. The Committee comprises Ratan N. Tata, Venu Srinivasan, Amit Chandra, Ronen Sen and Lord Kumar Bhattacharyya, as per the criteria in the Articles of Association of Tata Sons. The committee has been mandated to complete the selection process in four months.
Cyrus Mistry had in December 2012 become the sixth chairman of the Tata Group, replacing Ratan Tata. Mistry had been the director of the company since 2006. Mistry was earlier managing director of the Shapoorji Pallonji Group.
He graduated with a degree in civil engineering from Imperial College, London, UK, in 1990. In 1997, he received an MSc in management from the London Business School. Ratan Tata had been chairman from 1991 till his retirement on December 28, 2012.