Tata Sons director Noel Tata has sought a detailed examination of two proposals concerning the holding company's future, including a Rs. 25,000-crore exit plan from minority shareholder Shapoorji Pallonji (SP) Group and a restructuring proposal aimed at retaining Tata Sons' unlisted status.
In two letters dated October 29, addressed to company secretary Suprakash Mukhopadhyay, Noel requested that both proposals be discussed at the November 26 board meeting. He also sought detailed presentations covering valuations, regulatory implications, funding arrangements and implementation timelines.
The SP Group, which holds approximately 18.38% of Tata Sons, has proposed receiving Rs. 25,000 crore through a capital reduction arrangement.
Noel said he had raised the group's request during the September 17 board meeting and has now asked the management to provide a detailed assessment.
Under the proposal, Tata Sons would buy out shares held by SP shareholders for a gross consideration of Rs. 25,000 crore. The payment would be made in two or more tranches over 18 months.
The valuation would be determined by a merchant banker or registered valuer. Possible funding sources include internal cash flows, partial sales of listed company holdings, third-party investments in newer businesses and listings followed by offers for sale. The proposal does not envisage public borrowing.
The arrangement would require shareholder approval, consent from SP shareholders, clearance from the Mumbai bench of the National Company Law Tribunal and other regulatory approvals.
Separately, Noel has sought an evaluation of a September 28 proposal by Sir Dorabji Tata Trust and Sir Ratan Tata Trust to merge Tata Electronic Systems Solutions (TESS) and Tata Consulting Engineers (TCE) with Tata Sons.
The two trusts collectively hold 66% of Tata Sons. The proposed restructuring aims to make the company an operating business alongside its role as the group's holding company, potentially taking it outside the regulatory definitions of an NBFC and core investment company.
The merged entity is projected to report operating revenue of Rs. 1.05 lakh crore as of March 31, 2026, compared with Rs. 40,072 crore in income from financial assets.
Also Read: Tata Sons vs Tata Trusts: Why the RBI connection matters in the listing battle?
The November 26 meeting follows disagreements during September's board meeting over chairman N Chandrasekaran's reappointment and the proposed listing of Tata Sons. Noel opposed both proposals. The RBI has classified Tata Sons as an upper-layer NBFC, requiring it to list within three yeaRs. of identification. Its application to surrender its CIC registration was previously rejected.