Differences over what each side considers a fair valuation of the Tata stake was widely expected to be the next frontier in the biggest corporate feud in recent Indian history. Tata’s valuation threatens to stretch the battle further at a time when the indebted SP Group is desperately seeking funds for its own cash-strapped businesses.
“This is on expected lines,” said Shriram Subramanian, founder of proxy advisory firm InGovern Research Services Pvt., adding that bridging such a wide valuation gap is going to be difficult. “There is a long way of negotiations before they iron out issues.”
The valuation disagreement marks the latest chapter in a four-year-old wrangle that started with a boardroom coup in 2016 at Tata Sons.
It led to the abrupt ouster of Cyrus Mistry
as Tata Group chairman. Cyrus, 52, is the son of billionaire Mistry, 91, who controls the 155-year-old SP Group.
The Mistry family announced in September its intention to sever a 70-year relationship with India’s largest conglomerate, capping years of a bitter courtroom fight. The $113 billion coffee-to-cars conglomerate had told the court in September that it was open to buying the stock itself if Mistrys needed money.
A month later, the Mistry group said it estimated its Tata Sons stake to be worth more than 1.75 trillion rupees, including valuation of the brand, and sought pro-rata shares in listed Tata entities, cash, or any marketable instrument in lieu.
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