Kerkar Severs Links With Tata Group Firms

The last Tata satrap, Ajit Baburao Kerkar, yesterday ended a month-long controversy over his continued presence in the group by resigning from Tata Sons, Tata Industries and all Indian Hotels Ltd group companies, including its associates and subsidiaries. Kerkars resignation letter was addressed to the company secretaries of all the companies, including Tata Sons and Tata Industries.

After serving Indian Hotels for 35 years, Kerkar decided to sever his association with the Tata-run hotel chain yesterday. Yes, I have resigned from the Tatas, he confirmed to Business Standard yesterday. When asked to explain the rationale for his decision, the 65-year old former chairman and managing director of Indian Hotels responded, Because they (the Tatas) wanted my resignation.

 

I wish the Taj group and the House of Tata all the best, said Kerkar, whose term as IHL chairman and managing director ended amidst controversy last month. I will now go on a short leave for 6-7 days and then decide on my next course of action, he added.

However, hotel industry sources said Kerkar, who converted a virtually single-hotel company into a global hotel chain, may have even more ambitious plans for the future.

Noted jurist and ACC chairman emeritus Nani Palkhivala, who spearheaded the Tatas campaign against Kerkar, said: The House of Tata is an institution. It will not be affected by Kerkars resignation. When asked whether alleged Fera violation charges against the Kerkar-led

IHL brass would be investigated, Palkhivala said, There is no investigation, we only said we have lost confidence in him. It is his (Kerkars) decision to quit, Palkhivala concluded.

Tata group chairman and newly appointed Indian Hotels chairman Ratan N Tata could not be reached for his comments as he was out of town.

Kerkar had earlier hoped to continue as the IHL chairman for another 10 years, after his term as the companys managing director ended on August 31. However, the Tatas, led by Nani Palkhivala, accused the Indian Hotels brass of serious Fera violations and decided not to renew Kerkars contract. Kerkar was also informed that he was no longer welcome on the board of any Tata group company.

At an IHL board meet on Sept-ember 2, Kerkar had proposed the name of Ratan Tata as the next chairman. R K Krishna Kumar was appointed the companys new managing director, while S Ramakrishnan was named the new deputy managing director.

In the course of the meeting, Kerkar indicated that he would seek election to the post of IHL director at the companys annual general meeting, scheduled for October 10. However, his bid fell through after shareholders who had proposed his candidature withdrew their nomination, fearing a humiliating defeat for one of Indias foremost hoteliers.

Tata group sources said moves are also afoot to transfer Kerkar loyalists among the IHL executives. Kerkars executive assistant, Prasun Sengupta, has already been shifted to the Taj Business Centre.

Vijay Vadagdal-kar is likely to be shifted from IHLs company secretary department to PIEM Hotels.