Mehli Mistry, the promoter of M Pallonji and Co, has acquired 2.57 crore shares of Tata PowerBSE 2.13 %, in what’s seen as a bid to counter cousin Cyrus Mistry, the ousted chairman of Tata Sons. The purchase through the stock exchanges was valued at about .`200 crore and amounts to about 1% of Tata Power’s equity, a source close to Mehli Mistry said.
The timing of the purchase of shares is seen as significant. Cyrus Investment and Sterling Investment, belonging to Cyrus Mistry’s family, have filed a petition before the National Company Law Tribunal citing the “close relationship” between Ratan Tata and Mehli Mistry. The petition said contracts were awarded by Tata Power to Mehli Mistry’s firms because of his proximity to Ratan Tata, who replaced Cyrus Mistry as interim chairman of Tata Sons.
Cyrus Mistry’s camp has accused Mehli Mistry of wielding undue influence over Ratan Tata and suggested that this played a role in the ouster. “Mehli wants to show solidarity with Ratan Tata,” the source said. “He wants to show that not only is he a contractor but is prepared to put money where his mouth is.”
According to the same source, the purchase of Tata Power shares was made over a period of 10 days. The close friendship between Ratan Tata and Mehli Mistry is said to go back several decades. When contacted, Mehli Mistry neither confirmed nor denied the transaction, stating that he will talk at the “appropriate time.”
The purchases were made before a planned extraordinary general meeting (EGM) on Monday that was cancelled after Cyrus Mistry resigned from the boards of Tata Power and other group companies on December 20. Mehli Mistry was said to have been preparing to speak at the EGM to clear his name and support Ratan Tata.
