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Noel Tata pushes SP Group exit, restructuring proposals at Tata Sons
Chairman Noel Tata submitted proposals for SP Group funding and a merger to the Tata Sons board meeting on November 26, following a
Key points
- Chairman Noel Tata submitted a Rs 25,000-crore funding request for the Shapoorji Pallonji Group to the Tata Sons board.
- The Tata Sons board approved a five-year extension for Executive Chairman N Chandrasekaran on September 17.
- The Reserve Bank of India rejected Tata Sons' application to remain private on September 11, directing it to go public.
Why it matters. The board's decision on the restructuring proposal and SP Group's exit request could have far-reaching implications for the ownership and governance of the Tata Group.
Chairman of Tata Trusts Noel Tata submitted two proposals to the Tata Sons board scheduled for November 26, including a Rs 25,000-crore funding request for the Shapoorji Pallonji (SP) Group and a merger of Tata Electronic Systems Solutions and Tata Consulting Engineers with Tata Sons. This follows a September 17 board meeting where directors rejected Noel Tata's prior proposals and approved a five-year extension for Executive Chairman N Chandrasekaran, a move Noel Tata declared legally void.
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Noel Tata pushes SP Group exit, restructuring proposals at Tata Sons
A fresh power struggle is brewing at the top of the Tata Group, with Chairman of Tata Trusts Noel Tata pushing the Tata Sons board to take up two contentious proposals: the Shapoorji Pallonji (SP) Group’s Rs 25,000-crore funding demand and a merger of two unlisted group companies with Tata Sons to preserve its unlisted status. The crucial board meeting, which is scheduled for November 26, is likely to witness dramatic scenes, as other directors of the company had rejected Noel Tata’s proposals in the previous board meeting on September 17. According to sources, Noel Tata, a director of Tata Sons, sent two letters to the Tata Sons board on Thursday, seeking discussion and decisions on these two issues in the November 26 board meeting. “Under Article 121B, a director of Tata Sons can make proposals for consideration in the board meeting. Noel Tata has done that,” said a source. However, the Tata Sons board has not responded to Noel Tata’s letter dated October 26 so far. “This is surprising,” said a source. Noel Tata had on Monday demanded audio and video recordings of a crucial board meeting, questioned the filing of N Chandrasekaran’s reappointment resolution with the Ministry of Corporate Affairs, queried the role of Director Venu Srinivasan, and sought disclosures about reported commercial dealings between TVS Motor Company and a company associated with Chandrasekaran’s immedi.