Tata Sons receives shareholders’ approval to become private company
New Delhi: Tata Sons on Thursday received investors’ nod to change legal status of the holding firm to private limited from public one, limiting in effect Cyrus Mistry family’s ability to sell their stake to outsiders.
All resolutions placed before the annual general meeting (AGM) of shareholders were passed with requisite majority, a Tata Sons source said.
A resolution placed before the AGM pertained to changing the closely-held company’s registration to a private limited firm as opposed to a public one.
The Mistry family, which owns 18.4 per cent of Tata Sons, had called the move “oppression of the minority interests” and stated that it would vote against the proposal.
Tata Trusts holds 66 per cent in Tata Sons.
The voting pattern was not immediately known. At least 75 per cent of shareholders’ nod was required for the proposal to go through.
The move comes almost a year after Mistry was ousted as chairman of the Tata Group, triggering a bitter boardroom battle. N Chandrasekaran was appointed Chairman in January this year.
A public limited company allows shareholders to legally sell their stake to anyone. But a shareholder of a private limited firm cannot sell the shares to outside investors.
In a notice to its shareholders, Tata Sons’ board had sought approval through special resolutions to amend its article of associations to bring about the change.
It has also sought to amend the memorandum of association to change its name to Tata Sons Pvt Ltd from Tata Sons Ltd.
Last week, a Tata Sons spokesperson had stated: “The reinstatement of Tata Sons as a private company was considered by the board to be in the best interest of the company.”
Tata Sons, the promoter of major operating companies of the Tata group, was for past some days planning to convert itself into a private limited firm from a public limited one, which has been opposed by the family of ousted chairman Cyrus Mistry.
In a notice to shareholders ahead of its annual general meeting held today, the company’s board sought approval through special resolutions to amend its article of associations to bring about the change. It also sought to amend the memorandum of association to change its name to Tata Sons Pvt Ltd from Tata Sons Ltd.
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Source:Zee news
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