What is the story about?
Kolkata: Tata Sons has retained outgoing chairman N Chandrasekharan as its chairman for five years. While it was cleared by the Tata Sons board today in a three-hour meeting, where, according to reports, Tata Trusts chairman Noel Tata was out voted in the board, reports stated. It was also decided in the meeting that Tata Sons will be listed.
Pilot during turbulence
The Tata Sons board’s decision to repose faith in N Chandrasekharan is a clear indication that the board members reposed faith in the old hand when the group is in a turmoil. The root of the trouble was the Reserve Bank’s move to deny Tata Sons the option of surrendering its core investment company registration and deny Tata Sons to wriggle out of a situation when an IPO becomes mandatory.
In September 2022, the Reserve Bank of India (RBI) categorised Tata Sons as an upper-layer NBFC. The rules required the company to get listed in the stock market within three years. Tata Sons is the holding company of the Tata and they wanted to avoid public listing at any cost. On September 11, RBI rejected the voluntary application of Tata Sons, thereby making it impossible to avoid listing.
Stance of Noel Tata
Reports have indicated that Noel Tata who is the chairman of the Tata Trusts, which in turn, control Tata Sons, is opposed to the continuation of N Chandrasekharan
as chairman of the holding company. It has also been reported that the Tata Trusts and Noel Tata could oppose Chandrasekaran’s reappointment in the upcoming annual general meeting of Tata Sons.
Chandra, as Chandrasekharan is fondly referred to in the group, has to be reappointed as the director at the AGM to be able to continue as chairman.
The stock markets are, however, enthusiastic about a listing of Tata Sons. Several Tata group company shares have already jumped during the week after it became apparent that it will be difficult for Tata Sons to avoid listing.
