Boardroom Brawls, Lies & Audio Tapes...

If one were to write a book, the story of corporate India in 1997 might read like an action-packed thriller from the pashas of pulp fiction that is destined for a long stay on the top of best-seller lists.

Crammed in 365 pages, the book would have everything a lay reader wants when he strolls into a bookshop to pick up something that would see him through a long train journey.

It would have boardroom battles, takeover traumas, taped conversations and knights in shining armour who rush off to fight their friends battles while their own castles are under attack. It would also document the pains of restructuring and learning to live with globalisation and cut-throat competition.

Take for example, the countrys largest industrial group, the Tatas. Trying to restructure, the group went through one of its most painful phases this year since the 54 year old nephew of JRD Tata took over at the helm of the Rs 30,000 crore empire.

Ratan Tata spent most of the year fighting many battles. Whether it was sparring with septuagenarian Nani Palkhivala over the status of cement major ACC, or shuttling between Delhi and Guwahati trying to defend his companys reputation against charges of sedition, Ratan Tata was seldom without his gun cocked.

In between, he faced a bigger battle with Ajit B Kerkar, chairman and managing director of Indian Hotels, who refused to step down after attaining the retirement age of 65.

In a series of events leading up to the fateful board meeting on September 1 in Mumbai, Tata and his supporters managed to oust Kerkar, but not before puddles of dirty water appeared outside both Bombay House and Taj Mahal hotel.

As the year draws to a close, Tata can afford to relax in the knowledge that he has won, however pyhrric the victory might be. Most of the old satraps have been ousted, the ACC and the Tata Tea issues have been resolved, while Indian Hotels is being managed by a new team of professionals.

More importantly for Tata, the long-planned restructuring of the group looks set to take off. The study by McKinsey & Co was submitted in October-November and has been accepted. Tatas ambition of making the group leaner and stronger is likely to kicked off in the new year.

The new year is also likely to see a slew of fresh, young faces on many Tata boards. The revamp of top management gained pace in 1997 with changes in both Indian Hotels and Tata Industries, the holding company for many group companies.

If Tata can end on a happy note, his bosom friend and advisor Nusli Neville Wadia was not so lucky. For him the year was marked by a splash of controversy over the taping of his conversation with other industrialists on the Tata Tea affair. The tapes show Wadia lobbying for his friend Ratan Tata against the Assam governments move to prosecute senior Tata Tea officials including managing director R K Krishna Kumar.

That affair has now petered out with the Tatas reaching a compromise with the Assam government. For Wadia, the affair put him in the spotlight for some time. His companies, though continued to perform indifferently, with the exception of Britannia Industries. Bombay Dyeing, the flagship, had a bad run with falling DMT prices. The textiles division is being restructured but its benefits are still some time away.

Used hitherto to feuds among big time families, corporates were stunned in August this year when Atul Choksey managing director of Asian Paints broke ranks from his fellow promoters to sell his stake in the company to arch-rival ICI Plc.

The move, one of the biggest corporate events of the year, quickly snow-balled into a major stand-off when the other three promoters quickly closed ranks and refused to allow the transfer of shares to ICI.

They also managed to successfully lobby with the government to prevent the Foreign Investment Promotion Board from according permission to the British multinational.

For the last four months, ICI has tried every trick in the book from threats to sops, but the promoters have not budged. The result: The 9.1 per cent stake purchase by ICI continues to remain in limbo. ICI has already lost money in the deal following a sharp dip in the share price of Asian Paints, while the three promoters Ashwin Dani, Ashwin Choksi and Abhay Vakil have emerged winners, as of now.

In the midst of all this, India Inc India struggled to cope with another pressing reality, downturn in the industry. Producers watched in dismay as demand for their products fell and input costs rose. Coupled with high interest burden, the bottomlines of many companies took a severe beating.

India Inc also paid for the mistakes of the past. When inefficiency and profligacy ruled the roost and companies spread themselves far and too thin. The onset of international competition was bad enough and when this was coupled with recession, many companies faced a bleak future.

The Tatas and Birlas are some obvious examples. Voltas Ltd, the Tata major suffered its first ever loss this year, while Century Textiles, the B K Birla group flagship had to face the ignominy of slipping into the red in its 100th year. Steel Authority of India Ltd, one of Indias largest companies, also suffered thanks to a combination of high interest burden and operating costs. Saddled with a high workforce, Sail has no other option but to drastically restructure its functioning.

The worst hit were auto, cement, textile companies. Telco slipped from its position as Indias largest private sector company as inventories piled up, while another Premier Automobiles slipped deeper into the red. The joint venture Pal-Peugeot finally broke up with the French partner pulling out leaving the Doshis in the lurch. They now have the unenviable task of finding a player who will not only buy their stake but also infuse fresh cash into the company.

The core sector companies were also hit with ACCs profits falling to less than Rs 100 crore from over Rs 200 crore last year. Shake-out started in earnest in the cement industry with India Cements gobbling up Visakha Industries and training its guns on Raasi Cement. Gujarat Ambuja took over Modi Cement, while the Aditya Birla group eyed Shree Digvijay Cement of the Bangur group.

Many big groups could do little else but watch their helplessly as they slid downwards. The Mafatlals continued to sell, the latest being Gujarat Gas, gobbled up by British multinatinal, British Gas. The fate of Nocil continues to hang in balance.

Vijaypat Singhania, the most successful of the lot, gave into the reality of restructuring. Raymond Ltd, their flagship is exiting the steel business and is looking for buyers for its stake in the synthetic textile venture, Raymond Synthetics.

The blue-eyed boys of yesterday, multinationals, too fared badly. Companies like Whirlpool and Electrulux posted big losses and even Philips India, a veteran in the Indian market, was not spared.

After entering 1997 with a roar, the S Korean tigers ended the year purring like tame cats as the economic crisis in their country took its toll here. Samsung put off plans for a 100 per cent subsidiary while another Korean chaebol Ssangyong started pruning local operations. 1997 was a painful for India Inc. When the full impact of globalisation and competition hit them and they realised that old ways of working are over. As the new year dawns, they must be hoping that it turns out to be different from its predecessor.

Takeover traumas, taped conversations and fights with power centres. The corporate sector couldnt have done worse