Tata Sons on Wednesday announced the successor to Ratan Tata, naming Shapoorji Pallonji Group managing director Cyrus P. Mistry as the head of over $80 billion conglomerate Tata Group.
The 43-year-old Mistry, the son of Pallonji Mistry, chairman of the Shapoorji Pallonji Group that holds 18 per cent stake in Tata Sons, will take over the reins when Tata retires in December, 2012.
"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.
This is as per the unanimous recommendation of the selection committee, it added.
Tata Sons had constituted a five-member committee in August last year to scout for a successor to Ratan Tata. The committee comprised Tata Sons director R.K. Krishna Kumar, Tata Sons former vice-chairman N.A. Soonawala, group director Cyrus Mistry, Group Adviser and Lawyer Shirin Bharucha and influential British businessman Lord Kumar Bhattacharya.
Various candidates, including Tata's half-brother and son-in-law of Pallonji Mistry, Noel Tata and PepsiCo Chairperson Indra Nooyi were speculated to succeed Tata.
Commenting on the appointment, 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."
Tata 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."
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.
Ratan Tata would be hanging his boots in December 2012when he turns 75 — the retirement age fixed by the group with presence in businesses from salt to software.
Tata Group has over 90 companies, of which 28 are listed, including the country's largest software exporter TCS, India's largest auto maker Tata Motors and Tata Steel, which is the world's fifth largest steel maker.
Although the group is over 100 years old — founded by Jamsetji Tata in 1868 when he set up a private trading firm — it was only in 2006 that it earned a major global recognition when Ratan Tata spearheaded the buyout of Anglo-Dutch steel maker Corus for about $12 billion.
Rata Tata followed this up with another big ticket purchase of Jaguar Land Rover, the luxury British auto brands, from Ford in 2008 for $2.3 billion.
Tata had said: "I do not want to go out on a wheelchair."