Tata Sons Deny Sarna Exit Rumours, IHCL Share Price, Market Cap Dip
THE INDIAN Hotels Company Limited (IHCL) and Tata Sons on Thursday issued a one-line denial about the possible exit of Rakesh Sarna, Managing Director and CEO, Taj Hotels.
The note, which has been posted on the company website and sent to various media houses, stated: "The Indian Hotels Company Limited and Tata Sons wish to reiterate that reports about the exit of Mr Rakesh Sarna, Managing Director and CEO of Taj Hotels, Resorts and Palaces, are completely baseless and unfounded."
The rumours, as reported by BWHotelier.com, seem to have begun circulating when Sarna was abruptly called away to meet the Tata Sons board on a day that began with him addressing a town hall-style meeting of all group general managers at the Taj Mahal Palace and Tower, Mumbai.
The general managers attending the meeting said they were struck by Sarna's eloquence and he left them in a state of exuberance. The subject of the meeting was Tajness, the pet re-branding project initiated by Sarna with much fanfare some weeks ago.
Interestingly, the speculation coincided with the publication of the five-page letter that Cyrus Mistry wrote on October 25 to the directors of Tata Sons. The letter, which is stacked with information damaging to the reputation of the group and its performance under Ratan Tata, Mistry raises the prickly issue of the group's foreign acquisitions, which "had left a large debt overhang".
On Thursday, the IHCL stock took a 5.81 per cent, the highest in percentage terms among all the Tata companies that saw themselves slipping into a sea of red, and saw its market cap being hived off by 1,459.18 crore. It shares were trading at Rs 114.65 at the end of day on the Bombay Stock Exchange.
