THE CONSTRUCTION TYCOON Pallonji Shapoorji Mistry, who died a few days ago at the age of 93, may have been a quiet and reclusive figure in Mumbai’s power circles, but his wasn’t a presence you could ignore. The many iconic buildings and structures which he and his father built, especially in Mumbai—from the Reserve Bank of India and the State Bank of India, to the Taj Mahal Palace and Oberoi hotels, the Tata Institute of Fundamental Research and many more—stared down at you from landmark streets. The family’s investments over decades, most no•tably in Tata Sons, meant he was also invariably in the news. Pallonji was, in fact, dubbed the “Phantom of Bombay House”, a term that implied both reverence and suspicion that his family’s 18.37 per cent stake in Tata Sons generated at Bombay House, headquarters of the Tata Sons, the holding company for the Tata conglomerate. The Mistry family’s stake made them the largest minority shareholder in the company.
The construction business began in a small way in 1865, when Pallonji’s grandfather, also named Pallonji Mistry, came together with an Englishman to establish a construction firm that did small projects. Pallonji’s father Shapoorji Pallonji joined in 1902, his first contract being an unremarkable project of constructing a footpath at Mumbai’s Girgaum Chowpatty.
Over time as Mumbai grew, and along with it the Shapoorji Pallonji Construction Private Limited, Shapoorji and his son Pallonji transformed the city’s skyline. One can, in fact, trace the growth of the city and the ambitions of Indian enterprise following the trajectory of their firm. Mumbai’s growth as a textile hub and as the country’s financial engine meant that the city was in rapid need of scaling up, and the family was more than up to the task. They were also landing contracts elsewhere in the country, from building hotels, offices and residences to ports and factories. Pallonji joined his father as an 18-year-old in 1947, and formally took over the reins after his father’s death in 1975.
He may have inherited a large construction firm but he turned it into a sprawling empire. In the 1970s, Pallonji began to expand outside the country, most notably in the Gulf countries, where the new-found wealth of petrodollars was fuelling a construction boom. The first of these was a massive palace for the Sultan of Oman in Muscat, and its success fuelled more projects across the Middle East.
Pallonji spent large periods of time abroad later in his life, and took up Irish citizenship in 2003 through his marriage to Dublin-born Patsy Perin Dubash (which instantly made him Ireland’s richest man). Under his watch, the Shapoorji Pallonji Group included not just real estate and construction, but energy, financial services and more. His family also held large stakes in major companies, accumulating for him a net worth of around $29 billion. Pallonji took a backseat after his eldest son took over as chairman in 2004.
The most prized asset in the portfolio was, of course, the family’s stake in Tata Sons. The Mistrys built factories and mills for the ever-expanding Tata group, and the latter’s growth further fuelled the former’s wealth. This bond appeared to have become closer when Pallonji’s younger son Cyrus Mistry was appointed the chairman of Tata Sons.
But the prized asset proved to be a double-edged sword when the ouster of Cyrus plunged the two families into a long and bitter courtroom battle. The Supreme Court’s ruling last year that Cyrus’ ouster was legal, while also upholding Tata Sons’ rules on minority shareholder rights (which makes selling shares without board approval difficult for the Mistrys) could not have come at a worse time. The pandemic made a big dent in the construction business. According to reports, the Shapoorji Pallonji Group had to clear a major portion of its debts by selling its stake in companies like Eureka Forbes and Sterling & Wilson Renewable Energy, while also pushing around `5,100 crore of the family’s own money into the holding company.
With Pallonji’s death now, a glorious chapter in corporate India comes to an end.