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Some in the group believe that the four trustees led by Mehli Mistry are trying to weaken Noel Tata’s leadership at Tata Trusts.
Tata Trusts Chairman Noel Tata and Tata Sons Chairman N Chandrasekaran met Union Home Minister Amit Shah and Finance Minister Nirmala Sitharaman on Tuesday.
Vice Chairman Venu Srinivasan and Trustee Darius Khambatta were also present at the meeting, which took place amid the ongoing tussle between trustees over board appointments and governance issues.
₹15.9 lakh crore from the ongoing dispute in Tata Trust. The meeting is considered important amid fears of impact on the group.
Meanwhile, a major initiative has been taken towards ending the dispute between Tata Group and Shapoorji Pallonji Group. Tata Trusts may offer to sell 4-6% stake in Tata Sons to SP Group.
This step is necessary for SP Group because it has to repay a loan of Rs 30 thousand crores. The government’s concern is that SP Group, which is important for the country’s economy, might default due to huge debt.
Accusation of weakening leadership
Tata Trusts holds 66% stake in Tata Sons. According to reports, there is a rift between one group led by Noel Tata, who became chairman after Ratan Tata, and the other group led by Mehli Mistry (SP Group). The four trustees are accused of undermining Noel’s leadership and acting as a ‘super board’. Tata Trusts Board meeting is scheduled to be held on October 10.
What is the power controversy going on in Tata Trust?
Tata Trusts, the promoter and holding company of the conglomerate ranging from salt to semiconductors, exerts a profound influence on the Indian economy through its approximately 66% stake in Tata Sons.
There are two factions in the Tata Trusts, one of which is associated with Noel Tata, who was appointed chairman of the trusts after the death of Ratan Tata. The second group of four trustees is led by Mehli Mistry, who belongs to the extended Shapoorji Pallonji family, which holds about 18.37% stake in Tata Sons.
Mehli reportedly feels that he has been kept away from important matters. According to sources, the main bone of contention is seats on the board of Tata Sons, which controls the 156-year-old conglomerate, which comprises around 400 companies, including 30 listed firms.
A source said, “Given the importance of the Tata Group to the country’s economy, the biggest question before the government is whether it can hand over its control to a single person. The ongoing infighting among the trustees of Tata Trusts is also impacting Tata Sons.”
Controversy increased after the meeting held in September
- The root of this controversy is related to a meeting of six trustees of Tata Trusts. The trusts are a leading group representing several charitable trusts including Sir Dorabji Tata Trust and Ratan Tata Trust. On September 11, a meeting was called to consider the reappointment of former Defense Secretary Vijay Singh as a nominee director on the Tata Sons board.
- Tata Trusts has seven trustees including Singh. Singh did not attend the September 11 meeting as his nomination was on the agenda. Following Ratan Tata’s demise in October 2024, Tata Trusts introduced a policy under which annual reappointment of nominee directors on the Tata Sons board will be mandatory upon completion of 75 years of age.
- At the September 11 meeting, the proposal for reappointment of 77-year-old Vijay Singh, who has been a director since 2012 and a trustee since 2018, was moved by trusts chairman Noel Tata and Venu Srinivasan. However, four other trustees – Mehli Mistry, Pramit Jhaveri, Jahangir HC Jahangir and Darius Khambatta opposed it, due to which the proposal was rejected.
- Subsequently, all four trustees sought to nominate Mehli Mistry to the board of Tata Sons, but Noel Tata and Venu Srinivasan opposed the move and stressed the need for a transparent process in line with Tata’s values. Subsequently, Vijay Singh voluntarily resigned from the board of Tata Sons.
Noel is the son of Naval Tata’s second wife.
Noel is Naval Tata’s son from his second wife Simone. Ratan Tata and Jimmy Tata are the children of Naval and his first wife Suni. Noel studied at the University of Sussex.
Noel started his career with Tata International. In 1999, he was made the managing director of Trent, the retail arm of the group. It was started by his mother Simone.
In 2010-11, he was made the chairman of Tata International. After this, discussion started on making him the chairman of the group. Meanwhile, Cyrus Mistry himself talked about being made the chairman of Tata Group.
After this, Cyrus Mistry was removed from the post of Chairman of Tata Sons and Ratan Tata took charge of the group. In 2018, he was made Vice Chairman of Titan and in 2017, he was inducted into the board of the trust.
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