Two vice-chairmen of Tata Trusts have questioned a proposal to merge two Tata Group companies with Tata Sons, saying the plan was not discussed or approved by the trust’s board.
In a letter sent to fellow trustees, Venu Srinivasan and Vijay Singh said they were not consulted about the proposal involving Tata Electronics Systems and Tata Consulting Engineers. The letter also said they were unaware of any consultation with other trustees.
The proposal was put forward by Noel Tata, chairman of Tata Trusts, which said earlier this week that the mergers had been suggested to Tata Sons.
Plan Could Affect Tata Sons’ Regulatory Status
The proposed restructuring would increase Tata Sons’ operating income and could allow the holding company to exit oversight by the Reserve Bank of India as a core investment company, potentially removing the requirement for a public listing.
Tata Sons is the holding company for the wider Tata conglomerate, whose businesses include Jaguar Land Rover and Air India.
The dispute comes as tensions between Tata Trusts and Tata Sons continue to deepen. Tata Trusts holds a 66% stake in Tata Sons.
Tata Trusts did not respond to a Reuters request for comment. Srinivasan and Singh also did not respond to messages, while Noel Tata’s office had not immediately commented.
Governance Dispute Deepens
Srinivasan last week asked Maharashtra’s charity regulator to investigate what he described as growing intervention by Tata Trusts in Tata Sons’ commercial affairs. Singh filed a similar complaint on Wednesday.
The regulator has the authority to suspend trustees if it finds grounds to do so. Two sources said Noel Tata is seeking an opportunity to respond before any decision is made.
The latest development follows a decision by the Tata Sons board last month to reappoint N. Chandrasekaran as chairman and support plans for a public listing, despite opposition from Tata Trusts.
The competing positions have added another layer to an increasingly public dispute over the governance and future structure of one of India’s largest business groups.
