Wednesday, November 23, 2011

Second Non Tata Chairman of Tata Group appointed

Cyrus Mistry, MD of Shapoorji Pallonji Group, will take over reins of $80 billion conglomerate Tata Group, from Ratan Tata in 2012. The board of directors of Tata Sons at its meeting on Nov 23, 2011 appointed him as the deputy chairman and sixth chairman in waiting.
Did Ratan Searched him
or Compromised?

With this the debate and speculations about the successor of Ratan Tata comes to an end. A committee of Five wise men was formed last year to suggest the man to lead the group. This was labelled as India's biggest CEO search ever.

Many names including Indra Nooyi of PepsiCo and Nandan Nilekani were floated, but Ratan Tata’s half brother Noel Tata was considered as most probable. One of the biggest argument was that in the history of Tata group the only non-Tata person to be chairman of the group was Nowroji Saklatvala, who served from 1932 to 1938. He was son of the sister of founder of the group - Jamshedji N. Tata.

Noel and Cyruss are brother in laws. Cyruss’s sister Aloo Mistry is married to Noel Tata.

Shapoorji Pallonji Group holds 18 per cent stake in Tata Sons, yet Cyruss was not considered a serious candidate in the background of Ratan Tata’s statement given to a business newspaper way back in 2005. Though later, in August 2006 Cyruss was appointed a director, the youngest on the board of Tata Group at the age of 38.

In response to a question who would take position of the construction magnet Pallonji Mistry's on the board. Ratan Tata had reacted sharply, "Mr Mistry has no right of nomination. If there were a member of the Mistry family that comes on the board, it would be to represent the shareholding - if we chose to make that happen. Mr Mistry himself came on the board, we recognised him as the largest shareholder (of Tata Sons)”.

Born on July 4, 1968, Cyruss Mistry graduated from the Imperial College, London with a BE in civil engineering. He also holds a masters degree in management from the London Business School, and is a fellow of the Institution of Civil Engineers.

The task ahead for Cyruss would be very tough as expectations of the shareholders are high and during Ratan Tata’s twenty years the group has grown rapidly. It has grown more than 40 times since 1991. When Ratan Tata took over from JRD as the fifth Chairman of the group, the revenues were Rs 8,553 crore.

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