Tata Sons' Internal Rift: Trustees Debate Noel Tata's Leadership as IPO Looms
Tata Sons, the holding company of the expansive Tata Group, grapples with an internal divide as seven trustees question Noel Tata's leadership. This tension emerged after four trustees—Darius Khambata, Mehli Mistry, Pramit Jhaveri, and Jehangir HC Jehangir—rejected Noel Tata and Venu Sreenivasan's nomination of Ajay Singh for a third term at the Tata Sons Board, leading to Singh's resignation. Despite this, Tata Capital is poised to launch a Rs 15,512 crore IPO on Monday.
The disagreement came to light on August 14, with four trustees opposing Noel Tata and Venu Sreenivasan's nomination of Ajay Singh for another term. Singh subsequently stepped down. The Trusts wield significant influence, including veto rights, as outlined in Article 21 of Tata Sons' Articles of Association.
The Trusts currently comprise seven active members, with recent vacancies leaving the Tata Sons board with six members. Key trustees include Noel Tata, Venu Sreenivasan, Vijay Singh, Mehli Mistry, Darius Khambata, Pramit Jhaveri, and Jehangir HC Jehangir. Despite the internal discord, Tata Capital is moving forward with its IPO launch.
The rift has sparked queries about Noel Tata's leadership, with missed deadlines, nomination disputes, and the Shapoorji Pallonji Group's attempts to liquidate its stake adding to the tension. The Trusts amended their rules in October 2024, mandating annual reappointment for nominee directors over 75.
The ongoing debate among the seven active trustees of the Tata Trusts underscores the need for a resolution in the leadership issue at Tata Sons. Despite the internal strife, Tata Capital's IPO is set to proceed, suggesting business continuity for now. The future of Noel Tata's leadership and the Trusts' role in Tata Sons' governance remains uncertain.
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