The Tata Sons board has deferred a decision on the re-appointment of Natarajan Chandrasekaran as Chairman, signaling potential differences within the group. Concerns were raised about losses in certain group companies and the listing of Tata Sons.
The deferral of Natarajan Chandrasekaran's re-appointment as Chairman of Tata Sons has sparked questions regarding a previous unanimous resolution by Tata Trusts and potential internal disagreements.
Indications are that the Tata Sons stand on listing of the company may come up for a discussion even if it's not part of the agenda
Mehli Mistry is backed by three other trustees -- Pramit Jhaveri, Darius Khambata and Jehangir HC Jehangir -- against Tata Trusts Chairman Noel Tata and the two vice-chairmen, Venu Srinivasan and Vijay Singh.
Tata Trusts, which exerts decisive influence over India's most valuable conglomerate through its about 66 per cent stake of Tata Sons, finds itself in the midst of infighting among its trustees over board appointment and governance issues.
A quiet but consequential power struggle has erupted within the storied 156-year-old Tata Trusts just a year after the death of group patriarch Ratan Tata on October 9, 2024.
Tata Sons, now debt-free, has asked the RBI to drop its 'upper-layer NBFC' tag and allow it to stay private.
The Tata Trusts, led by the Sir Ratan Tata Trust and the Sir Dorabji Tata Trust, hold a 66 per cent stake in Tata Sons, the Tata group's holding company.
'The quality of a leader should be such that even if the leader is not there, the institution carries on.'
The billionaire Mistry family's estate is likely to soon change hands. The assets in the name of Cyrus Mistry, who died in September last year, may soon be divided equally among his wife Rohiqa and sons Firoz and Zahan, according to sources. The reorganisation will also include the 9.2 per cent stake in Tata Sons, which is currently in Cyrus Mistry's name and held through his investment company Cyrus Investments.
Shareholders of Tata Sons, the holding company and promoter of Tata group companies, have approved the reappointment of N Chandrasekaran as chairman for another five-year term despite its single largest shareholder the Shapoorji Pallonji family abstaining from voting, according to sources. In February this year, the Board of Tata Sons had approved the reappointment of Chandrasekaran as executive chairman for another five years till February 2027, subject to shareholders' approval. At the shareholders meeting held on Monday, the proposal for Chandrasekaran's reappointment for a second term needed more than 50 per cent of votes as it was an ordinary resolution.
If Cyrus's protestations of having no knowledge of his imminent dismissal are to be taken at face value, he was extraordinarily naive and insulated from the ground reality. There were enough straws in the wind to suggest that his relations with Ratan were fast deteriorating to a point of no return.
Refuting Tat's charges about Welspun buy, Mistry said to even suggest that the Tata Sons board including the nominee directors of the Tata Trusts had not been adequately informed is contrary to the factual record
With Amit Chandra's appointment, the Tata Sons board now has nine directors.
Refusing to be drawn into a point by point clarification of Mistry's letter, the company said: "It will be beneath the dignity of Tata Sons to engage in a public spat with regard to the several unfounded allegations appearing in his leaked confidential statement."
At TCS, Chandrasekaran would be succeeded by Rajesh Gopinathan, currently the company's chief financial officer.
'But we are much better than what we all had expected and planned, and what all the prophets of doom had predicted.'
The price movement and trading volumes for few days prior to Mistry's ouster will also be looked into
Mistry is halfway through in building Tata group's Gen Next.
Experts view this as a case of "failed experiment" in succession
Unless new members are inducted at jet speed, the strength of Tata Sons board will come down to four in July.
Amid speculation over Tata Sons chairman Ratan Tata's successor, the group has said that the selection committee has interviewed several candidates, both internal and external, but no final decision has been taken.
The Supreme Court in its order said it was not open for SP group companies to call Ratan Tata a "shadow director" when the board of which Cyrus Mistry was chairman had nominated him as chairman emeritus of the USD 100 billion salt-to-software Tata group.
"We are waiting for any input from any quarter," Civil Aviation Secretary R N Choubey said, adding, "We have not received anything so far".
Ratan Tata created India's first truly multinational business group. As he prepares to step down, the bar's been raised sky-high for his successor.
Mistry indeed followed standards of corporate governance so that it should not create any controversies at a later date
The notices from the stock exchanges followed reports about Cyrus Mistry disclosing possible writedown to the tune of $18 billion faced by the conglomerate
The last date to submit bids is March 17 but the deadline could be extended if there are requests from potential bidders.
Days after the disbanding of Group Executive Council set up by Tata Sons ousted chairman Cyrus Mistry, N S Rajan and Nirmalya Kumar have resigned from their respective board positions at Indian Hotels Company and Tata Chemicals.
Cyrus Mistry had put in place a strategy that would have pulled most of the Tata group's 'legacy hotspots' out of the financial mess from legacy issues and helped turn around the group's finances.
While media reports suggested that Tata-Singapore Airlines is looking at an all-stock merger of Jet, Tatas, in a statement said, discussions to take over Jet Airways have been preliminary and no proposal has been made
Tata Steel and Indian Hotels on Wednesday said they have always made all relevant disclosures and have no further comments to offer following comments made by ousted Tata Group chairman Cyrus Mistry that Tata group firms could face a potential USD 18 billion writedown.
Chandrasekaran served TCS for three decades as it rose to become the largest IT company in the country and also the crown jewel for Tata Sons
NCLT in its judgement said: "The removal of Cyrus Mistry as executive chairperson was because the board lost confidence and not because they were contemplating that he would cause discomfort to Ratan Tata, N Soonawala and others.' "The Board is competent to remove an executive chairman. Mr Mistry's removal from the position of director came because he admittedly sent out company information to the I-T (department), press, and came out in public against the board and the trust."
"Tata Sons board is meeting tomorrow (Friday) to consider the proposal to bid for Jet Airways," people in the know of the development told PTI.
The Tata Sons controversy has raised governance concerns. Arun Duggal and Mohandas Pai on the role of independent directors in such conflict situations.
Tata Sons on Friday announced organisational changes, bringing in S Padmanabhan as the group human resources head.
The government is keeping a "close watch" on the developments relating to the Tata-Mistry case, but does not want to "interfere" at present as it was an "internal matter" of a private group, Ministry of State for Corporate Affairs Arjun Ram Meghwal has said.
The Tata trusts can nominate one-third of the directors of Tata Sons
Cyrus Mistry, who was replaced as chairman of Tata Sons last Monday, October 24, still serves as the chairman of Tata Steel, Tata Motors, Tata Consultancy Services, Indian Hotels, Tata Global Beverages, Tata Chemicals, Tata Industries and Tata Teleservices.
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