Tata Sons rejects Mistry family's share-swap separation offer, calls it 'nonsense'

Tata group has rejected Mistry family-controlled Shapoorji Pallonji (SP) Group's share-swap separation offer to sever its 70-year-long relationship with the former. The SP Group has valued its 18.4 per cent stake in Tata Sons, Tata group's holding company, at $24 billion (or Rs 1.75 lakh crore), much higher than the Rs 80,000 crore estimate by salt-to-software conglomerate.

"It's nonsense. This kind of relief cannot be granted," said senior lawyer Harish Salve, who represented Tata Group, during a hearing before Supreme Court on Thursday. "I'm opposing it," he told the court.

While arguing on behalf of Tatas, Salve told the apex court that accepting the Mistrys' offer could cause the issue to spill over from Tata Sons to its listed firms where the SP Group would then be holding minority stakes.

In October, the SP Group had submitted before the Supreme Court to end ties with the Tata group and quoted Rs 1.75 lakh crore as the value of their 18.37 per cent stake in Tata Sons. It proposed that its share of the Tata brand and its unlisted group companies be settled in cash or in marketable securities. However, the Tata group has disputed this valuation.

On Tuesday, Tata group had told the court that the 18.37 per cent stake owned by Mistry family in Tata Sons is worth as much as Rs 70,000-80,000 crore. The court was hearing the cross appeals filed by Tata Sons and Cyrus Mistry's Cyrus Investments against NCLAT's order which had restored Cyrus Mistry as the executive chairman of the over $100 billion Tata conglomerate.

"Their investment has gone up... on our calculation, I think his share should be worth Rs 70,000-Rs 80,000 crore," Salve had told the court.

The top court had on September 22 restrained SP Group and Cyrus Mistry, as well as his investment firm, from pledging or transferring their shares of Tata Sons. On September 5, Tata Sons had moved the apex court seeking to restrain the Mistry group from raising capital against their shares. It sought to prevent SP Group from creating any direct or indirect pledge of shares.

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