Cyrus Mistri the Chairman of Tata Sons was ousted after a board resolution on 24th October 2016
EXACTLY a month back the Rothschild owned Economist had penned an article titled
QUOTE The expansionist strategy of his long-standing predecessor, Ratan Tata, which increased the group’s revenues from around $6 billion to $100 billion over two decades, had expanded the firm’s girth but dented returns in some parts of its business. A period to take stock of Tata’s portfolio of businesses would hardly have been controversial. Expand-then-refocus cycles are routine at multinationals.
But there is little sign that Mr Mistry is inclined that way. Tata remains active in 100 different business lines, many of which are themselves diversified. Far from slimming down, Tata is eyeing still further expansion: defence, infrastructure and financial services are the latest targets. There is a growing sense tha it lacks the “refocus” gene altogether.
The steel business eats up about half of the capital that earns low returns. Tata catapulted itself onto the global stage with its $13.1 billion acquisition of Corus, an Anglo-Dutch rival, in 2007. A turn in the commodity cycle from 2012, along with Chinese industrial overcapacity (see article), has hit it particularly hard. Corus was at one point reportedly losing £1m ($1.3m) a day. END QUOTE What the Economist failed to mention was that the Tata’s “advisors” in the Corus deal were NM Rothschild
The Economists solution to Tata’s problems??
QUOTE If Tata did wish to put more emphasis on shareholder returns—it says that it is only one metric it uses to gauge success—the next steps are obvious: it would flog some businesses, concentrate on improving the returns of others, and use the resulting proceeds to buy out outside shareholders in its operating firms.
The group could then function as one entity, taking advantage of synergies among the different business lines. It might also refocus its attention on fast-growing India, where just a third of its turnover now comes from. END QUOTE
“Flogging businesses” (Selling businesses) would involve N M Rothschild India whose business is “advising” parties in Mergers and Acquisitions
For the record N M Rothschild “advised” the Government of India in the infamous auctioning of telecom spectrum which lead to the infamous 2G scam
Reliance was the major beneficiary of the scam. Reliance Jio (earlier known as Infotel) was granted pan-India license for 4G in 2010 making it the only company to have all-India 4G license among others licenses. Jio employed the services of Anshuman Thakur (a former director at NM Rothschild and now Head of Strategy and Planning at Reliance Jio), an auction specialist who had designed the spectrum auction system in 2010. Swan Telecom was floated as a subsidiary of Reliance Telecom to circumvent the one-company-one-license rule. In 2008, Swan merged with Allianz Infratech; late in the year Abu Dhabi’s Etisalat bought about 45 percent of the company, renaming it Etisalat DB Telecom.
On June 28 2016 Economic Times reported that after building NM Rothschild’s India business for almost two decades the head of N M Rothschilds in India ,Sanjay Bhandarkar, quit as head of N M Rothschild India and assumed to a consulting role with the firm.
Its not as if Cyrus Mistri displayed any animosity towards the Rothschilds .On the contrary he hired Ajit Krishnakumar, an investment banker at Rothschild India and son of Tata group veteran R.K. Krishnakumar, to head a mergers and acquisitions team
One month after the Rothschild owned Economist wrote a critical article on Mistry and six days after the former NM Rothschild (India) chief joins a Tata company board Cyrus Mistri is abruptly fired by the board
That could be a simple coincidence or it could be another of those cohen-cidences that occur all over the world and the Tata Group could be in for a load of Group Flogging