Ratan Tata's successor is named

Cyrus Pallonji Mistry has been named the successor to Tata Group Chairman Ratan Tata, who will retire when he turns 75 in December 2012. Mistry will become the group’s deputy chairman effective immediately,

the

Wall Street Journal

reported.

Tata Group, founded in 1868 by Jamsetji Nusserwanji Tata, is India’s largest conglomerate and comprises more than 100 companies, the

Journal

report noted. Mistry will be its sixth chairman.

“Although it was speculated that the next group chairman would also have a Tata surname, Mr. Mistry’s appointment doesn’t come as a surprise,” the article said.

Cyrus Mistry is the younger son of Pallonji Mistry, the reclusive billionaire whose construction firm Shapoorji Pallonji & Co. is the biggest shareholder of Tata Sons [Tata Group’s holding company] with a stake of about 18%. Cyrus, who has been on the Tata Sons board since August 2006, is managing director of Shapoorji Pallonji.

A subsequent

Journal

report

noted that Mistry’s sister is married to Ratan Tata’s half-brother Noel Tata.

The

Financial Times

reported

that Tata Group has more than 450,000 employees, compared with 23,000 at Mistry’s family-owned group. Tata is a global conglomerate, while Shapoorji Pallonji & Co. operates predominantly in India, the report said.

The

FT

article said observers had hoped the group would pick an outsider as the successor.

Although the Tata Group is one of India’s most professionally managed conglomerates, it is still run in a fairly conservative manner, resembling a traditional family owned business.

(Sources:

Wall Street Journal,

Nov. 24, 2011 and Nov. 25, 2011;

Financial Times,

Nov. 25, 2011.)