Cyrus P Mistry is taking over the baton as the chairman of Tata Sons, the holding company for India’s largest business conglomerate, from Ratan Tata who retires on Friday. The 44-year old is the younger son of Pallonji Shapoorji Mistry, the single largest shareholder in Tata Sons.
He was chosen as the heir in November 2011 in one of the most high profile management transitions in India and spent a year as the deputy chairman. He pipped Noel Tata, half-brother of Ratan Tata, who was said to be the front runner to take over as the chairman. Mistry’s sister is married to Noel Tata.
Mistry joined the Shapoorji Pallonji Group in 1991 as a director and after the acquisition of AFCONS, he became its director and chairman in 2003. Under Mistry, Shapoorji Pallonji’s construction business grew from a turnover of $20 million to approximately $1.5 billion. The group’s companies have evolved from pure construction to executing projects under design and build and EPC delivery methodologies, implementing complex projects in the marine, oil and gas, and rail sectors.
A civil engineer from Imperial College, London, with a Master’s degree in Management from the London Business School, he had joined the board of Tata Sons in August 2006 after Pallonji Mistry stepped down as he turned 75.
Tata Sons is the privately held holding firm of a diverse business group with 100 operating companies which hit revenues of $100 billion during 2011-12, up from $83.3 billion in FY11. As much as 58 per cent comes from international markets, reflecting how the group snapped assets to expand beyond India.
About 66 per cent of the equity capital of Tata Sons is held by philanthropic trusts, endowed by members of the Tata family. The biggest of these trusts are Sir Dorabji Tata Trust and Sir Ratan Tata Trust, which were created by the families of the sons of Jamsetji Tata.
The group has a presence in areas like IT, communications, steel, engineering, materials, hospitality, services, energy, chemicals and consumer products. Some of its key group firms include Tata Consultancy Services, Tata Steel, Tata Motors, Tata Power, Tata Teleservices and Tata Chemicals.
Ratan Tata says adieu:
Ratan Tata, who retired after turning 75 (he will continue as honorary chairman emeritus) after a little over two decades at the helm of the conglomerate, has been associated with global expansion as his cornerstone strategy.
Having taken over as the chief of Tata Sons in 1991 (also the year India opened up to a global market with policy liberalisation) the great grandson of group founder Jamsetji Tata initially had a cold reception facing long standing strong group satraps, but eventually rose above them.
Under his stewardship, the group firms unleashed big ticket global expansion starting with the acquisition of Tetley. The expansion gained momentum in the 2005-08, with the group striking deals in steel (Corus), automobiles (Jaguar Land Rover), coal (two assets in Indonesia) among many others.
However, the outgoing boss is leaving at least one unfinished job for his successor. Having been rebuffed by the board of luxury hospitality group Orient-Express in the past, group firm Indian Hotels is back in the market to strike a deal to buy the NYSE-listed firm. Although the firm’s new proposal has also been rejected by Orient-Express, Tata Group has apparently not given up yet and it could be the first big challenge for Mistry.
(Edited by Prem Udayabhanu)
