Ending a year-long search, Mr Cyrus P Mistry, managing director of construction major Shapoorji Pallonji Group, was today named successor to Mr Ratan Tata at the helm of over US$ 80-billion conglomerate, Tata Group.
A non-Tata family person, 43-year-old Mr Mistry will take over from Mr Tata, who retires as the chairman of Tata Sons next December when he turns 75. This is the first time that a person outside the Tata family will head the salt-to-software conglomerate. “The Board of Directors of Tata Sons at its meeting today appointed Cyrus P Mistry as the Deputy Chairman. He will work with Ratan N Tata over the next year and take over from him when Tata retires in December 2012,” Tata Sons said in a statement.
Mr Mistry is the son of Pallonji Mistry, chairman of the Shapoorji Pallonji Group that holds 18 per cent stake in Tata Sons. Interestingly, Mr Mistry was also part of the five-member search panel appointed last year to find Tata''s successor.
Tata Sons, however, said Mr Mistry's appointment is as per the unanimous recommendation of the selection committee.
Various candidates, including Mr Tata's half-brother and son-in-law of Mr Pallonji Mistry, Mr Noel Tata and PepsiCo chairperson Ms Indra Nooyi were speculated as possible successor to Tata.
Commenting on the appointment, Mr Ratan Tata, chairman of Tata Sons, said: “The appointment of Cyrus P Mistry as deputy chairman of Tata Sons is a good and far-sighted choice. “He has been on the Board of Tata Sons since August 2006 and I have been impressed with the quality and calibre of his participation, his astute observations and his humility,” Mr Tata said.
He further said: “I will be committed to working with him over the next year to give him the exposure, the involvement and the operating experience to equip him to undertake the full responsibility of the Group on my retirement.”
Mr Mistry said: “I take this responsibility very seriously and in keeping with the values and ethics of the Tata Group, I will undertake to legally disassociate myself from the management of my family business to avoid any issue of conflict of interest.”
The five-member committee formed in August last year comprised Tata Sons director Mr RK Krishna Kumar, Tata Sons former vice-chairman Mr NA Soonawala, Group director Mr Cyrus Mistry, Group adviser and lawyer Mr Shirin Bharucha and influential British businessman Lord Kumar Bhattacharya.
Mr Tata, who took over as chairman in 1991 from JRD Tata, is responsible for bringing the group to the global map with the acquisitions of Corus Steel and Jaguar Land Rover.