JOIN USBrand Tata may see end of the day, says Tata Power
Tata Power has said that there is no surety that the ‘Tata’ brand will not be terminated in the future, and that a call to terminate it fully lies with Tata Sons.
“We have entered into a Tata Brand Equity and business promotion agreement dated December 18, 1998, for the use of the brand ‘Tata’ from Tata Sons. As per the terms of this agreement, Tata Sons may terminate the aforementioned agreement either in case of breach of any of the terms by us or any other specific reason set out in the agreement or with six months written notice for reasons to be recorded,” Tata Power said in an explanatory statement along with the EGM notice.
“We cannot guarantee that the aforementioned agreement will not be terminated in the future and this may result in our having to change the name of our company. Any value to our company in being associated with the ‘Tata’ brand may consequently be lost,” the company said.
Loss of this brand value could cause diversion of management time into rebuilding and restoring its reputation, which could have a material adverse effect on Tata Power’s business, financial condition, results of operations and prospects, Tata Power added.
Earlier in the statement, the company has stated that the independent directors were appreciative of the performance of Cyrus Mistry.
“Independent director meetings were conducted in March 2015 and March 2016. At both those meetings, the independent directors were appreciative of the performance of Mistry and had nothing of significance to recommend to him in that regard,” the company said.
The board confirms that all decisions taken by the board with regard to the business and operations of the company were unanimous, Tata Power added.