On Wednesday, the National Stock Exchange and Bombay Stock Exchange on Wednesday issued notices to a number of the Tata Group’s companies seeking clarification on ousted Tata Sons’ chairman Cyrus Mistry’s claims that the conglomerate faced a $18-billion writedowns, The Indian Express has reported.
The stock exchanges have asked Tata Steel, Tata Motors, Tata Teleservices, Indian Hotels and Tata Power to submit all details about the issues Mistry mentioned in a letter to the group’s board.
“…You are advised to provide the said information [events mentioned in the news], along with the sequence of events in chronological order and the material impact of this article on the company,” the exchanges said.
The Securities and Exchange Board of India (SEBI) is also keeping a close tab on the high profile Tata-Mistry case and will look into any possible breach of corporate governance norms and listing regulations at the listed companies of over $100 billion conglomerate. A Sebi official had said, “We will act immediately if there is any hint of possible violation of corporate governance and listing norms or any other regulation under our jurisdiction.”
According to a NDTV report, Sebi and the stock exchanges are keeping a close watch on the price movement and trading activities of the over two dozen listed Tata companies.
Mistry who was dismissed as Tata Sons chairman on October 24 by its board alleged “lack of corporate governance” and “failure on the part of directors to discharge the fiduciary duty” owed to shareholders of Tata Sons and other Group companies.
In his letter, Mistry had alleged that he had inherited “debt-laden” ventures during his tenure as chairperson, including Indian Hotels, Tata Motors’ passenger vehicle operations, Tata Steel’s European business, part of the group’s power unit and its telecommunications subsidiary.
Mistry has in his five-page email said “a realistic assessment of the fair value these businesses could potentially result in a write down over time of Rs 118,000 crores.”