In a likely sign of an end to a long-standing feud between Tata Group and its former chairman Cyrus Mistry, the conglomerate on Tuesday informed the Supreme Court that it was open to buying the shares in Tata Sons held by the Shapoorji Pallonji Group to aid the latter’s fund raising efforts.
The apex court, subsequently, restrained Shapoorji Pallonji Group and Mistry from pledging or transferring Tata Sons shares till October 28, when the case will be taken up next for hearing. The Shapoorji Pallonji Group, controlled by tycoon Pallonji Mistry and his family, own about 18 per cent of closely held Tata Sons, the holding company of the $113 billion software-to-cars Tata empire. The offer to buy Mistry group’s stake will help stave off the possibility of Tata Sons’s shares being pledged that runs the potential risk of falling in the hands of unfriendly investors, Bloomberg reported.
Earlier, it was reported that Mistry’s empire was in preliminary discussions to borrow as much as $1 billion by pledging a part of its Tata Sons stake to pay maturing debt after asset sales stalled amid the coronavirus pandemic.
Following this, on September 5, Tata Sons had moved the SC seeking to restrain the Mistry group from raising capital against their Tata Sons shares. Later, the SP Group which owns 18.37 per cent in Tata Sons had stated that the Tatas moved the apex court to block its plan to pledge shares for raising funds reeks of vindictiveness and oppression of minority shareholder rights.
The SP Group was planning to raise Rs 11,000 crore from various funds and had signed a deal with a marquee Canadian investor for Rs 3,750 crore in the first tranche against a portion of its 18.37 per cent stake in Tata Sons. The SP Group's shareholding in the country's largest business house is valued at over Rs 1 lakh crore.
Tata Sons acted just one day after the SP Group signed a definitive agreement with the investor.
