The Tata Sons board on Thursday approved a fresh five-year term for N Chandrasekaran as chairman of the holding company and decided to proceed with the listing of Tata Sons, following the Reserve Bank of India’s rejection of its application to surrender its regulatory registration.The decisions were taken at a crucial board meeting amid differences over the future leadership and ownership structure of the Tata Group.
Chandrasekaran’s reappointment marks a reversal of his decision last month not to seek another term when his current tenure ends on February 20, 2027. Tata Trusts chairman Noel Tata is understood to have opposed the reappointment, while Tata Sons director Venu Srinivasan backed it. The resolution was approved by a majority of the board.
The board also decided to comply with the RBI’s directive and initiate the process required for listing Tata Sons. The central bank had on September 11 rejected Tata Sons’ application to surrender its registration as a Core Investment Company, bringing the holding company back within the regulatory framework that requires large upper-layer NBFCs to list.
Tata Sons had sought deregistration after repaying more than Rs21,000 crore of debt.The listing decision, however, will require shareholder approval. Tata Trusts collectively hold about 66 per cent of Tata Sons, while the Shapoorji Pallonji Group owns about 18.37 per cent.
The development comes amid differences within Tata Trusts over both the listing and Chandrasekaran’s continuation. Noel Tata has opposed taking Tata Sons public, while some other trustees have supported the move.The RBI has also filed a caveat in the Bombay High Court after rejecting Tata Sons’ application, seeking to ensure that it is heard before any order is passed in the event of a challenge to its decision.
The board’s decisions now put the spotlight on the shareholder approval process and the next steps towards Tata Sons’ potential public listing.
Discover more from BizNewsWeek
Subscribe to get the latest posts sent to your email.
