Tata battle: Noel navigates a minefield; Chandrasekaran races the clock

The control of the Tata Group is entering a decisive phase. Noel Tata is struggling to clear regulatory hurdles to convene the Sir Ratan Tata Trust (SRTT) board and secure representation at Tata Sons’ annual general meeting (AGM), while chairman N. Chandrasekaran’s camp accelerates preparations for an initial public offering (IPO). Their objectives could hardly be more opposed—Noel wants Chandrasekaran out and Tata Sons to remain private, while Chandrasekaran is pushing for a listing that could create a more independent board, dilute the influence of the principal shareholder, Tata Trusts, and weaken the Noel Tata family’s hold over the group.

Noel’s first obstacle is the Maharashtra Charity Commissioner, whose permission he needs to convene an SRTT board meeting. The meeting must appoint a joint nominee with the Sir Dorabji Tata Trust (SDTT) to represent the Tata Trusts, which collectively own 66% of Tata Sons, at the AGM. Without a Trusts nominee, the AGM cannot achieve quorum.

Sources say the Commissioner has yet to grant permission. “Trusts representatives remain in touch with the authorities but have received no feedback,” said people familiar with the matter.

Complaints by Tata Sons vice chairman Venu Srinivasan, trustee Vijay Singh and, more recently, Mehli Mistry have compounded Noel’s difficulties. The disputes extend beyond SRTT to governance at SDTT and the Bai Hirabai Jamsetji Tata Navsari Charitable Institution. Mistry has approached the Charity Commissioner alleging governance failures and conflicts of interest at two trusts, while questioning their decision-making processes.

Last week, Noel and his son Neville Tata, also an SDTT trustee, filed caveats in the Bombay High Court and the city civil court in response to complaints lodged by Srinivasan and Singh with the Charity Commissioner.

The Tata Sons AGM is central to Noel’s attempt to block Chandrasekaran’s reappointment. The Trusts could vote against his reappointment as a director, potentially jeopardising his continuation as chairman for a third five-year term. The board has already approved the extension, despite Noel’s opposition at its last meeting.

The September 17 board meeting exposed both the extent and the limits of Noel’s influence. Over his objection, the board approved Chandrasekaran’s five-year extension, with Srinivasan backing the chairman. Harish Manwani, chairman of the Nomination and Remuneration Committee, cast the deciding vote, further complicating the dispute. The Trusts have challenged the interpretation of the Articles of Association (AoA), setting the stage for a legal battle over the validity of the decision.

Noel faces hurdles as IPO plans advance

Chandrasekaran’s camp, meanwhile, is racing against time as the Trusts remain entangled in regulatory and procedural hurdles. Tata Sons sources say IPO preparations are under way, including a review of the AoA and the legal and regulatory requirements for a listing.

The Reserve Bank of India (RBI) has rejected Tata Sons’ request to surrender its core investment company registration, intensifying the pressure to pursue a listing. The regulator has repeatedly directed the company to comply with the rules governing upper-layer non-banking financial companies, which include a listing requirement. At the September 17 meeting, the board agreed to set up a committee to examine IPO-related issues and consider the views of stakeholders.

Noel has proposed an alternative restructuring to keep Tata Sons private, involving the merger of Tata Electronics Systems Solutions and Tata Consulting Engineers into the holding company. However, the proposal has little prospect of advancing, as Tata Sons is not pursuing it seriously.

More than Chandrasekaran’s tenure is at stake. A listing could weaken the Trusts’ direct control over Tata Sons and, by extension, their influence across the group, while diminishing the significance of Noel’s veto rights. With the AGM route stalled and IPO preparations advancing, the battle is becoming a race between Noel’s legal and procedural manoeuvres and Chandrasekaran’s efforts to reshape Tata Sons’ governance structure.