The Tata Sons Imbroglio

This year, the fireworks started a week before Diwali. On Monday, October 24, the board of directors of Tata Sons, on the advice of the principal shareholders - the Tata Trusts - decided to "replace" the chairman of Tata Sons, Cyrus Mistry. The move was not only fairly abrupt, it hinted at all sorts of backroom manoeuvring. From the details that have come out so far, Mistry came to know of the impending move just before the board meeting when one of the directors told him to resign or else. At the board meeting itself, the agenda to remove Mistry was tabled under "any other business" so that the mandatory 15-day notice could be waived. And, according to a letter written by Mistry, he was not even given an opportunity to present his side of the case.

What made the Tata Sons board so keen to get rid of Mistry? And why couldn't they wait to remove him more decorously? The reasons have not been disclosed as yet, though perhaps they will in time. What is clear is that it was done at the advice of the Tata Trusts, which controls 66 per cent shares of Tata Sons and has a tremendous influence in the hiring and firing of the Tata Sons chairman, because of the Articles of Association of the company. The Articles of Association itself was changed to give the Trusts more power over Tata Sons when Mistry was appointed four years ago. Ratan Tata is the head of the Trusts for life.

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To read about how things came to a head and the conclusions that can be drawn from the replacement of Mistry, read our stories on the affair. They start on page 42. On the political front, too, there were plenty of fireworks in the week because of the enormous battle going on in the Yadav clan, which controls the ruling Samajwadi Party in Uttar Pradesh. With family member turning against family member, uncle against nephew, the feud threatens to split the party apart. How this will affect their chances in the coming elections will be apparent in a few months.

Meanwhile, this is our special annual issue of BT500, where we examine the biggest companies in corporate India by various parameters. Our primary list is compiled after looking at the average market capitalisation of the various listed companies. It gives a very clear idea of what the market thinks about the prospects of the biggest companies in the country. This year, Tata Consultancy Services is the numero uno by market capitalisation - just as it has been for the past few years. The only difference is that some of the sheen seems to have rubbed off the company this year, if the market cap is compared with last year's.

Apart from market capitalisation, we also have lists for the champions by revenues, profits and assets. Taken together, the lists give an excellent insight into the companies that have done exceptionally well, the companies that are plodding along, as well as the companies that have performed well under par.

The BT500 package starts on page 64.