Tata heir questions big bets as US$185 billion group feud deepens

Detailed summary

Noel Tata has questioned whether some of its biggest investments are being executed with enough discipline. Read more at straitstimes.com.

Noel Tata, chairman of the trusts that control Tata Group, questioned whether some of the conglomerate’s biggest investments are being executed with enough discipline.

MUMBAI – Noel Tata, chairman of the trusts that control Tata Group, questioned whether some of the conglomerate’s biggest investments are being executed with enough discipline, deepening a dispute over capital allocation, control and a potential listing of its holding company.

The clash has widened as the group commits billions of dollars to semiconductors, aviation, electronics and electric-vehicle batteries, while the trusts that own 66% of Tata Sons resist a listing that would bring outside shareholders into the closely held parent.

The dispute now reaches beyond succession and ownership to how a group generating about US$185 billion (S$238.3 billion) in annual revenue is funded, governed and run.

“The question is, do we have the discipline when we execute projects, and not the direction?” Tata said on Nov 14 at the Hindustan Times Leadership Summit in New Delhi. “How will projects with a long gestation period succeed if we don’t have discipline?”

Much of the expansion has been pursued under Natarajan Chandrasekaran, the professional executive who has led Tata Sons since 2017. A confidential analysis prepared by Tata Trusts and reviewed by Bloomberg News estimated that semiconductors, electronics and aviation would require more than two trillion rupees (S$27.33 billion) in additional capital.

The governance dispute widened after Tata Sons’ board backed Chandrasekaran for another five-year term on Sept 17, despite Noel Tata’s opposition.

A spokesperson for Tata Sons did not immediately respond to a request for comment on his remarks about execution, capital allocation and a possible listing, sent over the weekend.

Tata companies generated about US$185 billion in revenue in the year through March and own businesses ranging from Jaguar Land Rover to Tetley tea.

Opening of the article, excerpted from The Straits Times Business. To read the rest, open the article on the publisher's site.