Madhu Kannan, chief executive officer of the Bombay Stock Exchange(BSE), has quit his position as the chief of the stock exchange to join Tata Sons, the holding company of the diversified business conglomerate, as group head of business development, Tata Sons said on Tuesday.
He will report directly to Cyrus P Mistry, deputy chairman of Tata Sons, who is due to take over the reins of the privately held company which controls the multi-billion dollar goliath. The high profile role at Tata Sons also sends a signal by the incoming chief to the rest of the group on his intention of bringing in young blood at senior positions at one of the oldest business groups in the country.
Mistry, who is due to succeed Ratan Tata as chairman of the group at the end of this year, wasafter a global search to lead India’s largest business group. 43-year old Mistry is the younger son of Pallonji Shapoorji Mistry, the single largest shareholder in Tata Sons.
Tata Group has over 100 operating companies and revenues of $83.3 billion in FY11, with 58 per cent coming from international markets. The group has a presence in areas like IT, communications, engineering, materials, hospitality, services, energy, chemicals and consumer products.
Kannan, aged-38, had joined BSE in May 2009 and would take his new role at Tata Sons after completing three years at the helm of Asia’s oldest stock exchange next month.
Kannan joined as the managing director & CEO of BSE from Bank of America-Merrill Lynch where he was the managing director (strategy & business development), based out of New York. He joined Merrill Lynch in March 2008 and focused on the development and execution of key strategic initiatives for Merrill Lynch in the emerging markets of Asia and Middle-East & North Africa (MENA) and the global sovereign wealth funds group.
Prior to Bank of America-Merrill Lynch, he was senior vice president at NYSE Euronext. In his long innings with the US exchange, he has served in various senior roles across a range of businesses including vice president(corporate client group), head of international listings (Asia Pacific region), and managing director (international strategy and business development of the exchange).
Kannan earned his undergraduate degree BE (Hons) in Electrical and Electronics, M Sc (Hons), in Economics from BITS, Pilani and an MBA in finance from Vanderbilt University, USA.
His appointment as the chief of BSE was seen as a big move of bringing in independent professionals to lead BSE which has been facing tough competition from younger rival NSE.
The post of CEO of BSE lay vacant for around nine months after Rajnikant Patel, resigned abruptly in August 2008. It was also a period when stock market saw a sharp downward swing after the global financial crisis, hitting a bottom in March 2009.
BSE had appointed executive search firm Egon Zehnder to shortlist candidate for the CEO’s job. Besides Kannan, others in the race were NSE’s CTO Ravi Apte, Reliance Industries’ CIO Ashish Chauhan and M L Soneji, then the COO and acting CEO of BSE.
Soon after joining BSE, Kannan had brought in new faces at senior positions at the bourse. He roped in former NYSE executive and investment banker James E. Shapiro as the head of market development of BSE besides Sayee Srinivasan from Chicago Mercantile Exchange to head product strategy and former law & compliance director of DSP Merrill Lynch, Nehal Vora, as head of planning and policy.
Shapiro no longer retains the designation but continues as senior advisor at BSE and Srinivasan quit BSE two months ago to go back to the US as financial economist at Commodity Futures Trading Commission. Vora continues at BSE.
BSE counts amongst its investors Deutsche Börse, Singapore Exchange, Aditya Birla PE besides Argonaut Ventures among others.
According to a report by Reuters, a committee would be named to oversee the running of BSE until a new chief executive is identified.