Noel Tata's firm IPO stand stalls Chandra's 3rd term

AN EARLY AGENDA item for Tata Sons' six board directors when they convened at 11:30 a.m. on Tuesday at Bombay House—the group’s storied headquarters—was expected to be straightforward: approving a third term for Natarajan Chandrasekaran as chairman.

- PR SANJAI

Within two hours, the conversation had veered off course. What had looked like a done deal, with Tata Trusts itself recommending the reappointment just months ago, quickly unravelled.

Noel Tata, the head of Tata Trusts, began pressing Chandra—as he’s widely known—with tough questions. Most critically, Noel sought assurances that the group’s holding company could avoid a public listing, people familiar with the matter said, asking not to be named as the discussions were private. Tata Trusts is a collective of 13 charities, which together control two-thirds of Tata Sons.

Noel also laid down several conditions: restraining debt levels, stemming losses—especially at Air India, and reaching a swift settlement with Tata Sons’ largest minority shareholder, the Shapoorji Pallonji Group, the people said. The SP Group, which owns about 18.4%, was locked in a corporate and legal battle with Tata Sons for years and is still looking to monetise a part of its stake.