Tata Motors Ltd’s share price down, investors reject a compensation package for late head Karl Slym

The shareholders of the largest Indian car manufacturer by revenue Tata Motors Ltd rejected a pay proposal for three of the companys senior executives, including a compensation package for the companys late India chief Mr. Karl Slym. According to companys investors, Mr. Slyms family may have to give back most of the 152.5 million rupees (5.6 million dollars) that they have already received.

According to a statement by Ms. Minari Shah, a spokeswoman of the company, Tata Motors Ltd has already paid off the money, but did not receive the 75% approval rate from investors that was needed in order to compensate the late Managing Director Karl Slym with any larger sum than 4.8 million rupees.

The Director of Institutional Investor Advisory Services Mr. Amit Tandon said in a statement, cited by the Financial Times: “It’s not that Tata Motors was paying a large sum of money. These are all professionals – it’s not that they are owners that are taking money out of the company and putting it in their pocket.”

The company has been looking for its shareholders approval not to reclaim 31.95 million rupees from Ravindra Pisharod, the executive director of commercial vehicles. Tata Motors Ltd also has sought its investors consent for the payment of executive director of quality, Satish Borwankar, amounting to 24.6 million rupees as well as for 146.4 million rupees in compensation for legal heirs of Karl Slym during the financial year ended on March 31st.

The Vice President for equity research at Ashika Stock Broking Ltd Paras Bothra commented the rejection for Bloomberg: “This sort of shareholder rejection of executive compensation hasn’t happened at a large company. There is increased shareholder awareness these days.”

Tata Motors Ltd was 0.06% down to close at 469.45 Indian rupees per share today, but still marking a one-year increase of 60.28%. According to data published by the Financial Times, the 52 analysts offering 12-month price targets for Tata Motors Ltd have a median target of 481.00, with a high estimate of 575.00 and a low estimate of 334.00. The median estimate represents a 2.39% increase from the last price of 469.75.