- Tata Sons AGM was called off due to lack of quorum linked to Sir Ratan Tata Trust restrictions
- Chairman N Chandrasekaran will not seek another term, triggering successor identification process
- Tata Trusts, controlling 66% of Tata Sons, play a key role in selecting the next chairman
Tata Sons' Annual General Meeting (AGM) was called off due to a lack of quorum, sources told NDTV Profit, adding that the development was linked to a restriction involving the Sir Ratan Tata Trust (SRTT).
The AGM was held against the backdrop of Tata Sons Chairman N Chandrasekaran deciding not to seek another term at the helm of the holding company. His decision has set in motion the process of identifying his successor, with the Sir Dorabji Tata Trust beginning the exercise.
Tata Trusts, which control around 66% of Tata Sons, are expected to play an influential role in the succession process. Noel Tata, who chairs Tata Trusts, is therefore emerging as a key figure in the selection of the next Tata Sons chairman.
However, the appointment will be made through a formal committee process prescribed under the Articles of Association of Tata Sons.
At a Tata Sons board meeting in May, Chandrasekaran had presented plans covering the performance, growth prospects and capital requirements of the group's newer businesses, including electronics and aviation.
During discussions, Noel Tata had raised concerns over some businesses, including Air India and BigBasket, particularly their losses. Tata Electronics, meanwhile, emerged as a relatively brighter spot in the subsequent discussions.
ALSO READ: Noel Tata At Centre Of Group's Leadership Transition After Chandra Exit: Report
Noel Tata's role in the succession process comes as he himself approaches a transition across several Tata Group companies. He is due to retire from the boards of six Tata companies in November after turning 70, in line with the retirement policy applicable to non-executive directors.
The companies include Trent, Tata Steel, Titan, Voltas, Tata Investment Corporation and Tata International.
However, Noel Tata will continue as a director on the Tata Sons board, as nominees of the Tata Trusts are not subject to the retirement-age limit applicable to other non-executive directors.
The leadership transition comes at a critical juncture for Tata Sons, which has significantly expanded its presence in sectors such as aviation, electronics and semiconductors under Chandrasekaran.
With the search for Chandrasekaran's successor now underway, Noel Tata's position as chairman of Tata Trusts and a director of Tata Sons places him closer to the centre of the leadership transition at one of India's largest business groups.
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