Turbulence deepens at Tata Sons after board reverses chair’s exit

By the Editorial Team · Friday, September 18, 2026

Tata Sons’ board voted to extend executive chair N Chandrasekaran’s tenure by five years and approved preparations for the conglomerate’s IPO, despite opposition from the largest shareholder, Tata Trusts, which has challenged the extension and listing as unlawful. The decision sets the stage for potentially India’s largest-ever IPO, intensifying a power struggle that could transform the company’s governance and expose key subsidiaries to market pressures and legal battles.

The boardroom conflict at Tata Sons, India’s largest conglomerate, escalated as its directors voted to extend the tenure of executive chair N Chandrasekaran by five years, a decision immediately challenged as unlawful by the group’s largest shareholder, Tata Trusts. The trust, chaired by family member Noel Tata, controls two-thirds of the holding company’s shares and opposes both Chandrasekaran’s extension and the proposed public listing of Tata Sons.

At a highly consequential board meeting held recently in Mumbai, directors approved preparations for Tata Sons’ initial public offering (IPO), responding to a directive from the Reserve Bank of India (RBI) that the holding company must list publicly. The central bank rejected a two-year-old appeal by Tata Sons seeking exemption from these listing rules, which apply to top-tier non-banking financial companies, a categorization under which Tata Sons was placed in 2022.

The listing could value Tata Sons at over $120 billion, potentially setting the stage for India’s largest-ever IPO and significantly altering the governance and ownership structure of the 150-year-old conglomerate. The move has triggered concern among some Tata insiders that the IPO could expose key subsidiaries, including Tata Consultancy Services and Air India, to shareholder activism or corporate raiders.

The vote to extend Chandrasekaran’s term marked a reversal from his earlier announcement in August that he would step down due to a lack of unanimous board support. Noel Tata was the sole director opposing the extension, citing legal grounds based on the company’s Articles of Association, which require unanimous consent from the charitable trusts' nominee directors for strategic resolutions. Currently, Tata Trusts has two nominees on the board—Noel Tata and Venu Srinivasan—with Srinivasan voting in favor of Chandrasekaran’s extension and the listing plan.

Tata Trusts described the extension vote as a “legal nullity” since it did not have the required unanimous approval. Noel Tata warned the board the decision could face significant legal challenges from shareholders. He also voted against complying with the RBI listing directive, reflecting the trust’s firm stance against the IPO. Noel Tata has argued that going public could jeopardize the group’s ability to make long-term strategic investments, a view some critics interpret as motivated by a desire to retain control within the charitable trusts.

The RBI’s insistence on a public listing follows its recent dismissal of Tata Sons’ request to remove its shadow bank classification. Officials indicated the decision likely had the backing of Prime Minister Narendra Modi, underscoring the government’s regulatory pressure on Tata Sons to comply immediately.

While Chandrasekaran’s reappointment may ultimately be decided at the next annual general meeting, internal divisions remain stark. Earlier this year, Noel Tata reportedly conditioned his support for Chandrasekaran on a commitment to avoid listing the company, and he has also opposed other major strategic initiatives led by Chandrasekaran, including investments in semiconductors and financial support given to Air India.

The latest maneuvers underscore a deepening power struggle within Tata Sons, with significant legal and business implications that could reshape one of India’s most storied business houses.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.