Thursday, October 27, 2016

I had no say in aviation foray: Mistry

Tata Sons tied up with AirAsia in February 2013 to start an airline and six months later joined hands with Singapore Airlines. Both the decisions occurred within a year of Cyrus Mistry taking over as group chairman, but now as Mistry's letter to Tata Sons' board members indicates he had little role in them.
Mistry's letter also highlights Rs 22 crore fraud in AirAsia India adding that a first information report was filed only on the insistence of an independent director. AirAsia did not immediately respond to a query seeking a comment.

In his letter, Mistry points out negotiations with both AirAsia and Singapore Airlines (JV partners in AirAsia India and Vistara) were carried out by Ratan Tata and that he had been presented with a fait accompli.

Tata Sons is majority shareholder in both the airlines.

“The passion for the airlines sector has led Mr Tata  to continue his involvement with the strategy of the two airlines. It is on his advice that Tata Sons board has increased the capital infusion in the sector at multiple levels of the initial commitment,” Mistry said.

Ratan Tata's interest and involvement in the airline business was  clearly evident as in 2013, Tata led AirAsia and Singapore Airlines bosses to meetings with the then Civil Aviation Minister Ajit Singh seeking approvals. Again in early February he also spoke out against the controversial '5/20' rule, which scuttled the overseas expansion plans of two airlines.

In July 2013, Ratan Tata was appointed as an advisor to the AirAsia India board.
27/10/16 Aneesh Phadnis/Business Standard

0 Comments: