Cyrus Mistry denies Tata Group's claim on Welspun Power buy

Stepping up his attack on the Tata Group in general and Ratan Tata in particular, ousted chairman Cyrus Mistry, on Friday, denied group's claim that the board was not properly consulted on Tata Power's purchase of Welspun Power in June.

"It is surprising that Ratan Tata has sought to justify Monday's conduct by making vague public statements that are contrary to his knowledge and contrary to the records of the Tata Group. Tata sources said the trustees of Tata Trusts were not kept informed about the transaction with Welspun Power," Mistry said in a late night statement.

He said that all the board notes were shared with Tata in his capacity as the chairman emeritus of the group.

Presenting his side of the facts, Mistry said in the early part of 2016, Tata Power had made a presentation to Tata Sons that a significant focus area would be the renewables sector. And this was appreciated by the Tata Sons board.

"On May 31, 2016, a note was circulated to the board of Tata Sons and to Tata providing information about the proposed Welspun transaction, and asking them if they needed any further information.

"The only board member to reply was Vijay Singh, a nominee director of Tata Trusts on the Tata Sons board, who appreciated the plan. And with no other view having been expressed, Tata Power executed the agreement on June 12, 2016," Mistry said.

Mistry further claimed that even after the conclusion of the deal for a Rs 10,000 crore, a series of discussions took place in the presence of Tata, and trustee NA Soonawala. "These discussions included much more detailed interaction with the merchant bankers to the transaction.

Soonawala had strong views on how this listed operating company must structure its transaction and proceeded to have further meetings with the merchant banker," he said. Since shareholder nod was needed to arrange the funds for the transaction, the deal was discussed again at the Tata Sons board.

"On June 30, 2016, Anil Sardana, CEO of Tata Power, made a detailed presentation to the Tata Sons board. The discussion covered all aspects of the transaction including the structure and the Tata Sons board unanimously approved the transaction," Mistry claimed in the statement.

The minutes record that Nitin Nohria and Vijay Singh "after discussing the proposal with Tata and Soonawala", while reiterating their view that the proposal should have come to the trustees earlier, approved the transaction.

"Therefore, to even suggest that the Tata Sons board including the nominee directors of the Tata Trusts had not been adequately informed is contrary to the factual record," he concluded. Hitting out at Cyrus Mistry for making 'unsubstantiated claims and malicious allegations', Tata Sons, on Thursday, said the former chairman was fully empowered to lead the group and its companies but had "overwhelmingly" lost the confidence of board members.

The promoter company of the major Tata group companies also alleged that Mistry's tenure was marked by repeated departures from the culture and ethos of the group.