Thursday, Aug 11, 2022

Who was Pallonji Mistry? Here’s what you need to know about the ‘Phantom Of Bombay House’

One of the richest men in India and Europe with a net worth of almost $29 billion, Mistry saw the expansion of 156-year-old Shapoorji Pallonji Group beyond the borders of India

Pallonji Mistry
Pallonji Mistry

Pallonji Shapoorji Mistry, the chairman of the Shapoorji Pallonji Group and one of India’s most venerable entrepreneurs, passed away at his residence in Mumbai on Tuesday. He was 93. 

One of the richest men in India and Europe with a net worth of almost $29 billion, according to the Bloomberg Billionaires Index, Mistry saw the expansion of the 156-year-old conglomerate, which started off with construction and real estate, beyond the borders of India. 

With an 18.4 per cent holding, the billionaire was also the largest individual shareholder in the Tata Group after his father had first purchased shares in Tata Sons, which controls the $100-billion conglomerate, in the 1930s. This would later spark the biggest corporate feud that India has ever seen.

Born on June 1, 1929, to a Parsi family from Gujarat, Mistry took up Irish citizenship in 2003 through his marriage to Dublin native Patsy Perin Dubash. That also made him Ireland’s richest person at the time of his death. 

Mistry was awarded the Padma Bhushan in 2016 for his contributions in the field of trade and industry.

Rise of the Pallonji Son

In 1947, at the age of 18, Mistry joined the empire that his father, Shapoorji Pallonji, had built from scratch with a single construction contract in Mumbai in 1865. The group is known for constructing various iconic landmarks across the country, including the Reserve Bank of India building, the Bombay Stock Exchange building, The Taj Mahal Palace hotel, the Brabourne Stadium, among others.

As chairman of the group, Mistry, who had an eye for new opportunities, expanded the business to Abu Dhabi, Dubai and Qatar in West Asia in addition to India, Africa, and South Asia.

Under his leadership, the company bid for and won a tender to build the palace of Sultan Qaboos bin Said al Said, the late Sultan of Oman, in Muscat. When the Sultan opened his Muscat palace for visitors in 1975, it established Shapoorji Pallonji as the first Indian construction company to have completed a project abroad.

Under him, the group ventured deeper into engineering and construction, infrastructure, real estate, water, energy and even financial services. 

Tata-Mistry Clash

The billionaire had a massive chunk of his estimated fortune locked up in a legal battle with the Tata Group, India’s largest conglomerate.

Mistry was often called the Phantom of Bombay House, which housed the Tata Group’s head office, as he was rarely seen there. The usually media-shy Mistry and his family made headlines in 2012 when his younger son, Cyrus, was chosen to lead the Tata Group, succeeding group patriarch Ratan Tata. 

However, his stint ended in a conflict after a boardroom coup in 2016 led by Tata Trusts, triggering one of India’s worst corporate showdowns. This led to the two families, which had been partners for 70 years, facing each other in a long courtroom battle.

Mistry’s family has since filed numerous lawsuits against the holding company’s board, alleging suppression of minority interests and governance lapses. In 2020, the Shapoorji Pallonji Group announced that it would sell its stake in the Tata Group.

However, Mistry, who would have derived an estimated $16.7 billion of his fortune from his equity in Tata Sons, could not sell the stake without the approval of a board that his family continues to fight. In 2021, the Supreme Court ruled that Cyrus’ ouster was legal and also upheld Tata Sons’ rules on minority shareholder rights which made it more difficult to sell shares without the board’s approval. 

Despite having a diversified set of businesses, the Shapoorji Pallonji Group faces a tough future after being forced to look at the sale of assets in 2020, saddled with a cash crunch, burgeoning debt, and more.