Tata Sons Chairman N Chandrasekaran resigns, to complete term till February

Tata Sons Chairman N Chandrasekaran has resigned, but will remain in the role until February amid a leadership dispute.

In Short

• N Chandrasekaran resigns as Tata Sons chairman, to complete term till February
• Resignation follows differences between Tata Sons and Tata Trusts on reappointment
• Stocks of Tata Group firms fell up to 4% after resignation news broke

Tata Sons Chairman N Chandrasekaran has resigned from his position but will continue in the role until his current term ends in February, according to a source familiar with the matter, reported Reuters.

The development comes at a time when the Tata Group is dealing with several challenges across its businesses and follows differences between Tata Sons and Tata Trusts over his reappointment.

It must be mentioned that Tata Sons is the principal holding company of the $400-billion Tata Group. It controls more than 30 companies, including Tata Consultancy Services (TCS), Tata Motors and Air India.

Tata Sons is 66% owned by Tata Trusts, the group's charitable arm.

CHANDRASEKARAN TO COMPLETE CURRENT TERM

Chandrasekaran's current term as chairman of Tata Sons is due to end in February. The source, who spoke on condition of anonymity because of the sensitivity of the matter, said he has resigned but will complete his term.

In February, Tata Sons postponed a decision on extending his tenure after Noel Tata, chairman of Tata Trusts, opposed the move, according to an earlier Reuters report.

Noel Tata was seeking several conditions, including a commitment that Tata Sons would never be listed. Chandrasekaran was not willing to give such a commitment, according to a source. The two sides also differed over board representation.

SHARES FALL AFTER LEADERSHIP SHAKE-UP

Tata Group stocks fell as much as 4% on Wednesday after Reuters reported that Tata Sons Chairman N Chandrasekaran had resigned, triggering a selloff across the conglomerate’s listed companies.

Tata Consultancy Services (TCS), India’s largest IT services exporter, led the decline, falling 4.1%. Tata Motors, which owns Jaguar Land Rover, dropped 2.8%.

Meanwhile, in a statement on Wednesday, Chandrasekaran said he had informed the Tata Sons board of his decision and asked it to begin the succession process soon to ensure a smooth transition.

"I have completed 40 years of professional life at the Tata Group. I am grateful for the immensely satisfying opportunity to contribute to this venerable institution. Leading Tata Sons over the past decade has been a great honour and a profound responsibility," he said.

- Ends