NEW DELHI (Reuters) - India’s Shapoorji Pallonji (SP) group, the largest minority shareholder in Tata Group, believes it is necessary to separate interests from the autos to steel conglomerate, it said on Tuesday.
One of the country’s largest construction firms, the SP group has an 18% stake in Tata Sons, the holding company of the Tata Group, on the back of a decades-long relationship.
But the two groups have been embroiled in a legal battle since 2016 when Cyrus Mistry, scion of the family that controls the SP Group, was sacked as chairman of Tata Sons.
Mistry was sacked from the top job at the helm of the holding company after he fell out with group patriarch Ratan Tata over corporate governance issues at Tata group companies.
On Tuesday, India’s Supreme Court restrained the SP group and Mistry from pledging or transferring shares of Tata Sons owned by them.
The Mistry family was looking to pledge the shares to raise funds to “meet the crisis arising from the global pandemic”, the SP Group said in its statement, but had been challenged by the Tata Group.
“Today, it is with a heavy heart that the Mistry family believes that a separation of interests would best serve all stakeholder groups,” the statement said.
Tata Sons did not immediately respond to questions from Reuters.
Reporting by Devjyot Ghoshal; Editing by Rupam Jain, David Goodman and David Evans
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