Cyrus Mistry named Ratan Tata successor

This means Ratan’s kin Noel Tata (they are half-brothers) will not get a chance to sit in the chief’s chair.

Cyrus Mistry was one of the committee members who were entrusted with the task of searching out Ratan Tata’s successor.

Noel Tata is the son-in-law of Pallonji Mistry,the largest single shareholder in Tata Sons with an approximate stake of 18%.

The find-Ratan-Tata-successor committee consisted of Tata Sons Director R K Krishna Kumar,Tata Sons former vice chairman N A Soonawala,group director Cyrus Mistry,group adviser and lawyer Shirin Bharucha and influential British businessman Lord Bhattacharya.

Tata Sons today in the evening formally announced the successor to Ratan,naming Mistry as the head of over USD 80 billion conglomerate Tata Group.

The 43-year-old Mistry,the son of Pallonji Mistry,Chairman of the Shapoorji Pallonji Group that holds 18 per cent stake in Tata Sons,will take over the reins when Tata retires in December,2012.

“The Board of Directors of Tata Sons at its meeting today appointed Cyrus P Mistry as the Deputy Chairman. He will work with Ratan N Tata over the next year and take over from him when Tata retires in December 2012,” Tata Sons said in a statement.

This is as per the unanimous recommendation of the selection committee,it added.

Tata Sons had constituted a five-member committee in August last year to scout for a successor to Ratan Tata. The committee comprised Tata Sons Director R K Krishna Kumar,Tata Sons former Vice-Chairman N A Soonawala,Group Director Cyrus Mistry,Group Adviser and Lawyer Shirin Bharucha and influential British businessman Lord Kumar Bhattacharya.

Various candidates,including Tata’s half-brother and son-in-law of Pallonji Mistry,Noel Tata and PepsiCo Chairperson Indra Nooyi were speculated to succeed Tata.

Commenting on the appointment,Ratan Tata,Chairman of Tata Sons,said: “The appointment of Cyrus P Mistry as Deputy Chairman of Tata Sons is a good and far-sighted choice.

“He has been on the Board of Tata Sons since August 2006 and I have been impressed with the quality and calibre of his participation,his astute observations and his humility.”

Tata further said: “I will be committed to working with him over the next year to give him the exposure,the involvement and the operating experience to equip him to undertake the full responsibility of the Group on my retirement.”

Tata,who took over as Chairman in 1991 from JRD Tata,is responsible for bringing the group to the global map with the acquisitions of Corus Steel and Jaguar Land Rover.

Ratan Tata would be hanging his boots in December 2012 when he turns 75 — the retirement age fixed by the group with presence in businesses from salt to software.

Tata Group has over 90 companies,of which 28 are listed,including the country’s largest software exporter TCS,India’s largest auto maker Tata Motors and Tata Steel,which is the world’s fifth largest steel maker.

Although the group is over 100 years old — founded by Jamsetji Tata in 1868 when he set up a private trading firm –it was only in 2006 that it earned a major global recognition when Ratan Tata spearheaded the buyout of Anglo-Dutch steel maker Corus for about USD 12 billion.

Rata Tata followed this up with another big ticket purchase of Jaguar Land Rover,the luxury British auto brands,from Ford in 2008 for USD 2.3 billion.

Tata had said: “I do not want to go out on a wheelchair.”

From the Financial Express archives:

Ratan Tata successor can’t be found?

Eight months after it was set up to find a successor to Tata Sons Chairman Ratan Tata,the search panel has concluded that it cannot find a “replacement” for the group chief.

“Our committee has come to the conclusion that we cannot find a replacement for (Ratan) Tata!”,said Tata Sons Director and one of the members of the committee R K Krishna Kumar in an interview published on the company’s website.

Group holding company Tata Sons in August last year had set up a five-member panel to find a successor to Tata,who is due to retire in December 2012 when he turns 75.

Apart from Kumar,other panel members are Tata Sons former vice chairman N A Soonawala,group director Cyrus Mistry,group adviser and lawyer Shirin Bharucha and influential British businessman Lord Bhattacharya.

Showering lavish praise on Tata,Kumar said the search panel might have to lower the benchmark to find a successor to the head of USD 71 billion business empire.

“He (Tata) is a born leader and you can see this wherever he goes…He has a place in the history of post-independence India”,he said,adding “we may have to change and re-arrange the model in terms of what we are looking for”.

“We are now considering people — from within the group and outside,including expatriates — who can fill the role we have in mind. There are challenges but we will soon come to a conclusion”,he said.

Tata was the inspiration behind the launch of small car Nano. An astute business leader,he was driving force behind Tata Steel acquiring Anglo-Dutch steel maker Corus as well as Tata Motors buying luxury British auto brands Jaguar and Land Rover.

Well respected Tata’s reputation,however,took a beating after his conversation with corporate lobbyist Niira Radia was leaked. Both Tata and Radia recently appeared before Parliament’s Public Accounts Committee (PAC) that is looking into the 2G spectrum allocation scam.

While announcing the search panel last year,Tata Sons had said the group would require someone with experience and exposure to direct its growth amidst the challenges of the global economy.

“The selection process for a prospective candidate would consider suitable persons from within the Tata companies and other professionals in India as well as persons overseas with global experience,” it had said.

Five wise men to hunt for Ratan Tata’s successor

Noel Naval Tata’s role in the over $71 billion crore salt-to-software conglomerate clearly got bigger last week with his appointment as managing director of Tata International. In the meanwhile,the board of Tata Sons announced on Wednesday it had formed a selection committee,comprising five members,including an external member,to decide on a suitable successor to groups chairman Ratan N Tata,who retires in December 2012 when he turns 75.

“The committee has commenced its work,” a press release said,adding that “the selection process for a prospective candidate would consider suitable persons from within the Tata Companies,other professionals in India as well as persons overseas with global experience.”

The committee will comprise two directors from the Sir Dorab Tata Trust and the Sir Ratan Tata Trust,two members from the Tata Sons board and one external,non-Tata Group person. The selection committee names being speculated about are NA Soonawala,Keki Dadiseth,Jamshed J Irani,R Gopalakrishnan,AN Singh and the outsider and Ratan Tata’s close confidante and Bombay Dyeing Group chairman Nusli Wadia. Ratan Tata will not be a member of the search committee.

Ratan Tata had said in the past that his successor could be an expatriate. “It would be certainly easier if that candidate were an Indian national. But now that 65% of our revenues come from overseas,it could also be an expatriate sitting in that position with justification now that we are a company that has global reach and global presence,” Ratan Tata had told The Wall Street Journal last November to a question on how he was conducting the search for his successor

“The successor,I would hope,would have integrity and our value systems in the forefront and hopefully would carry on the path that we have tried to set for the company’s growth,” Mr Tata had observed. The chairman had indicated to a magazine earlier in 2009 that his successor would need up to 18 months as handover time.

While names,including Indra Nooyi of PepsiCo and Vikram Pandit of Citigroup have been talked about,Noel Tata has been considered a frontrunner for the group chairman’s position. Indeed,the stint at Tata International is expected to give the 53 year-old Noel Tata exposure to the group’s overseas businesses; he has spent about a decade at Trent,building the retail business. Tata International,a leather and engineering and trading company has a presence across ten African nations. A graduate of Sussex University,Noel Tata is the son-in-law of Pallonji Mistry,the largest single shareholder in Tata Sons with a stake of 18%.

In addition to Mistry,the board of Tata Sons,chaired by Ratan Tata comprises among others FK Kavarana,Jamshed J Irani,Ishaat Hussain,R Gopalakrishnan,RK Krishna Kumar and Arunkumar Gandhi.