Cyrus Mistry Has Not Only Destroyed Tata Group, He is Destroying India’s Equity: Sivasankaran
A TV grab of Aircel founder Sivasankaran
Chennai: Ousted Tata Sons Chairman Cyrus Mistry, in an explosive letter to the board last week, mentioned a loan given to entrepreneur C Sivasankaran of the Siva Group as one of the many wrong moves of the previous Tata management that he had to put up with.
NRI businessman Sivasankaran, the founder of telecom company Aircel, is known to keep an extremely low profile. In this exclusive interview with News18's Poornima Murali, Sivasankaran, who is now based in Chennai, refuted the allegation and claimed his loan was against security of his shares in the group company Tata Teleservices as he blasted Mistry for "destroying" the Tata group.
Excerpts from an exclusive interview:
Ousted Tata Sons Chairman Cyrus Mistry, in his explosive letter to the board, mentioned a loan given to C Sivasankaran of the Siva Group as one of the many wrong moves of the Tata management that he had to put up with. In this exclusive interview with News18’s Poornima Murali, the Chennai-based Sivasankaran refuted the allegation and claimed his loan was against security of his shares in the group company Tata Teleservices. Excerpts from an exclusive interview:
CNN-News18: Why do you think you were dragged into the Tata-Mistry controversy? Are there any personal issues between Cyrus Mistry and you?
It is a fact that we borrowed Rs 200 crore. But he could have written in the letter that it was against the Rs 700-crore security of shares. Also, it was settled in 2014. So there could not have been any controversy (if Mistry had clarified all this).
I wrote a two-page letter to DoT asking for spectrum to be auctioned and Government of India got Rs 148,000 crore. I am not the one saying this. CAG has written a book saying the government got it. But then the Supreme Court cancelled my license and I lost Rs 2,000 crore. I had a bank guarantee, I had a personal guarantee to Batelco because of which I had to face bankruptcy. I got out of all these problems. I don’t find any fault with Cyrus for doing that. I don’t have any personal issues with Cyrus. It happened and we have clarified now.
CNN-News18: Do you believe Mistry could have averted this controversy?
Cyrus could have averted this controversy. Cyrus right now is an angry man. He expected to be the Chairman for next 30-40 years. But then after 4 years for non-performance, board of directors tells him: No you have not performed, please step down as the Chairman. He got disappointed and the mildest expression of disappointment is anger. In anger, he reacted and we lost Rs 35,000 crore of market cap for shareholders. It is not fair because he still is the Chairman of many Tata companies, he is still the director and he is reacting very wildly and destroying the value of Tata group, which was built over 100 years.
One thing is for sure, by this action, it proves that you should never be the Tata group Chairman because he reacts within 24 hours. Cyrus had an opportunity of agreeing with the board and thanking the board who supported him for four years, thanking the 600,000 employees and more importantly issue is the fact that India’s brand equity is very good. He has not only destroyed Tata group, he is destroying India's equity.
CNN-News18: What do you think was the reason behind the war of words?
In one of the interviews he said he was forced to be a lame-duck Chairman for 4 years. Maybe partially it's true. Partially what he is not saying is that he brought Madhu Kannan and started listening only to him. He gave Ratan Tata’s office to Madhu Kannan. He equated Madhu Kannan to Ratan Tata and he became a dummy chairman according to him, not according to me. In a way he created all these things. I can vouch for one thing – during the 7-year period that I was associated in advising Ratan Tata personally, every plane I used, every time I stayed in the hotel, all were paid for. Tata said our value system does not allow Siva to compromise on anything. Tata followed a very higher governance and transparency. I can’t comment about Cyrus because I don’t know much. I haven’t met him for the last 4 years.
CNN-News18: How do you view the Tata-Docomo split?
Docomo is very fair in asking for Rs 8000 crore, but it was not fair that they joined and destroyed the value of Tata Teleservices. Docomo is an international company and had a Japanese director. First quarter in 2012 - when Cyrus took over - they made a loss. Second quarter too, they made a loss. For sixteen quarters, they made losses. What have they done to arrest losses? They rewarded non-performance – they accepted mediocrity. They never followed anything that the Tata institute teaches or trains. It is a sad story. I’m a victim of four years of TTSL not performing. I lost Rs 3000 crore. I will hold both companies for mismanagement.
CNN-News18: There are reports that the Tata Group is planning to raise funds to buy out the stake of Shapoorji Pallonji Group in Tata Sons. What are your views?
I do not know but I would not do that. My first focus would be to tell Indians that the whole country is a customer for Tata Group. The primary aim today should be to focus on four things: customer, profit, figure out how to handle competition and focus on any business that you acquire. Tata is good for creating passion. If rumours were to be believed, it certainly would be a wrong move.