Chandrasekaran reappointed Tata Sons chairman, Noel disagrees

The Tata Sons board on Thursday voted 4-1 in favour of N Chandrasekaran continuing at the helm of the group holding company for next five years, but the decision, however, has been contested by the Tata Trusts chairman Noel Tata. Tata Trusts controls 66% stake in the group. "Given that Mr Noel Tata, being one of the Trust nominee directors, voted against the proposal, it was rendered legally void and without any basis," a statement from the Tata Trusts said.
The company's board met on Thursday for the first time since Chandrasekaran made his decision to quit public and said that he agreed to the "Board's request to re-consider his decision". "At the meeting of the Board on September 17, Chandra acceded to the Board's request to re-consider his decision. The Board thereafter resolved by a majority vote to re-appoint him as Executive Chairman for a further term of five years upon the expiry of his current tenure," Tata Sons said. The board comprises Chandrasekaran, Noel Tata, Venu Srinivasan, Saurabh Agrawal, Harish Manwani and Anita Marangoly George.
Chandrasekaran's current term is ending on February 20 next year. The Board, Tata Sons said, also resolved to initiate steps to comply with the applicable RBI Guidelines and will seek guidance from RBI, Tata Trusts and other stakeholders on applicable compliance requirements.
The Tata Trusts maintained that in its view Chandrasekaran's decision to not continue after February 2027 and its acceptance was final. "The Tata Trusts reiterated their considered position that the decision of Mr. N. Chandrasekaran, Chairman of Tata Sons, not to offer himself for reappointment upon the conclusion of his current tenure on 20 February 2027, has been duly accepted and has attained finality." The Trusts' position remains unchanged, as a considered judgement of a majority shareholder. This position was reiterated in today's board meeting by the Chairman, Tata Trusts, it added.
According to people familiar with the matter, the Tata Trusts, headed by Noel, would move to oust Chandra at the Annual General Meeting (AGM). “Once he is ousted as a director he cannot continue as chairman,” said a person familiar with the matter. “The AGM will be held the moment the SRTT issues is resolved,” the person said. Attention will now shift to Tata Sons’ adjourned annual general meeting, which is required to be held by December 31. The AGM assumes significance because Chandrasekaran is due to retire by rotation as a director of Tata Sons and his reappointment will require shareholder approval.