Circa 1971, a Tata came to the rescue of a Wadia who was being done out of his inheritance by another Wadia and a Mistry.
Circa 2016, a Wadia (actually the same one), has come to the rescue of a Mistry (the grandson of the other Mistry) who is fighting a Tata (the nephew of the other one) for what he considers are his rights.
That Nusli Wadia, now 72, continues to fight shouldn’t surprise anyone although it has come as a surprise to many that all doesn’t seem to be well between Ratan Tata, the interim chairman of Tata Sons Ltd, and him.
This is confirmed by people who know both men, who were once very good friends.
Wadia stood by Ratan Tata when the latter took over as chairman of Tata Sons in 1991 and had to deal with entrenched satraps in the group such as Tata Steel Ltd’s Russi Mody, ACC Ltd’s Nani Palkhivala and Tata Chemicals Ltd’s Darbari Seth.
Wadia is the godson of the late J.R.D. Tata (and even named his son after the Tata patriarch). He was also once considered a possible heir to Tata at Tata Sons.
In 1971, when he returned to India after his education, hoping to take over Bombay Dyeing & Manufacturing Co. Ltd, he found his father Neville Wadia had agreed to sell it to R.P. Goenka. The deal had the blessings of Shapoorji Pallonji Mistry, who held a 40% stake in Nowrosjee Wadia & Co., which, in turn, held 7% of Bombay Dyeing. Wadia wasn’t going to give up, though, and he was supported by J.R.D. Tata.
Since then, he has been a supporter of the Tata group and Ratan Tata, even interceding on the latter’s behalf when an investigative report in The Indian Express in 1997 reproduced a tapped telephone conversation between Wadia, Ratan Tata, and a few others over Tata Tea Ltd’s problems in Assam with the local government headed by Asom Gana Parishad’s P.K. Mahanta.
That was a volatile period in Assam, which was still in the grip of militant campaigns waged by groups such as the United Liberation Front of Assam, and also New Delhi, where the government wasn’t particularly stable. Wadia tried to enlist the support of L.K. Advani of the Bharatiya Janata Party (BJP), a friend and mentor, to help. The BJP was then the single largest party and also the main opposition in the Lok Sabha.
Wadia has also been an independent director of long standing in some Tata companies—he has been on the boards of Tata Steel and Tata Chemicals for more than 30 years.
So, what went wrong between Ratan Tata and Wadia?
The people cited in the first instance say the two men have drifted apart since the 1990s, and that the Tata group’s entry into aviation, where Wadia has interests through GoAir, may have been a factor in souring the relationship further.
Then came Cyrus Mistry’s surprising ouster as chairman of Tata Sons on 24 October.
On 10 November, Wadia and other independent shareholders of Tata Chemicals expressed confidence in Mistry’s chairmanship—the first indication that all was not well between the old friends.
Subsequently, Tata Sons, on 11 November, sought the removal of Wadia as director of Tata Steel, Tata Chemicals and Tata Motors. On 21 November, Wadia wrote to Tata Sons threatening legal action. “I hereby call upon you to withdraw your special notice immediately or prove beyond doubt, the statements made therein, within two days of this communication,” he wrote. The special notice made a requisition to the board of directors of Tata Steel for convening a shareholders’ meeting—the agenda of which included removal of Wadia as a director.
Among other things, the Tata Sons notice accused Wadia of acting in “concert with Cyrus P. Mistry” and acting as an “interested party” working against the interests of the Tata group.
In a 16 November note, proxy advisory firm Institutional Investor Advisory Services (IiAS) wrote that while promoters are well within their legal rights to seek the removal of a director, Tatas’ move was an unprecedented one. Singling out Wadia “adds fuel to the rumours that the differences are personality-driven, rather than issue-based,” IiAS said.