NEWS DAILY

MUMBAI: In its over 140-year history, the Tata group has had just five chairmen -- only one a non-Tata. As it searches for its sixth chairman, Noel Tata is being tipped by many as the frontrunner. His position would seem to have been further fortified with the announcement that the five-member panel appointed to name the next Tata chairman includes Cyrus Mistry, the younger son of construction tycoon Pallonji Mistry.

Cyrus Mistry is the brother-in-law of Noel Tata, who is married to Aloo Mistry. Pallonji Mistry is the largest single shareholder in Tata Sons, the group's holding company, with an 18% stake. However, given the famed values of the Tata Group and its stakeholders, no one is seriously suggesting that the next head will be chosen for reasons other than merit.

The other members on the search panel, whose names were announced on Friday, are Noshir Soonawala, adviser to the Tata group, RK Krishnakumar, a trusted lieutenant of Ratan Tata, Shirin Bharucha, a member of the board of Sir Ratan Tata Trust -- a significant shareholder in Tata Sons -- and Lord Bhattacharyya, director and founder of Warwick Manufacturing Group (WMG) who is a close friend of Ratan Tata. The panel is expected to finish the serach process by March 2011.

The names of several possible successors to Tata, including Indra Nooyi, Arun Sarin and Carlos Ghosn, have been doing the rounds. But Noel was recently given an enhanced role in the group by being named vice-chairman of Trent, the group's retail company, and managing director of Tata International. Tata watchers believe this move is not without significance.

Besides Pallonji Mistry's 18% stake in Tata Sons, Noel Tata and his mother, Simone Tata, also hold shares of Tata Sons. While Noel holds 2,055 shares (0.5%) in Tata Sons, Simone holds 2,011 shares (0.49%).

In past interviews, Ratan Tata had said the group views the Pallonji Mistry family's membership on Tata Sons' board as one that was basically representing their shareholding. However, Cyrus's inclusion in the panel to choose a successor points to the family's interest in the matter. Cyrus, an Irish national, was appointed to the board of Tata Sons in 2006 and became the youngest board member.

This is the first time any Indian family-run business has set up a panel to search for a successor. The panel, which will identify the most suitable candidate taking into account the global nature and complexity of the group's business, represents the interests of all shareholders of Tata Sons, which include the various trusts, the Pallonji Mistry family and Tata Companies. The trusts hold 66% in Tata Sons.

Among the panelists, Soonawala is the trustee of the Dorabji Tata Trust, which has a large shareholding of 28% in Tata Sons. He is also a group advisor. During his tenure, Soonawala guided the financial operations of various group companies with transparency and enabled Tata Sons to consolidate its holdings in major operating companies of the group.

Speaking of Soonawala's contribution to the group, Ratan Tata told shareholders at the Indian Hotels' AGM on Thursday that he has been a great contributor in creating financial instruments for the group. ``He has agreed to be an advisor to the group and we would continue to have the benefits of his creativity,'' said Tata.

Krishna Kumar, on the other hand, has played a pivotal role whenever the group has undertaken a major restructuring or M&A and also in times of crisis, such as the one faced by Tata Finance nearly a decade ago. Even during the terror attack on the Taj hotel in south Mumbai in November 2008, Krishna Kumar was standing alongside Ratan Tata throughout the turmoil, meeting victims and pacifying employees.

Of the other panelists, while Bharucha is a lawyer who has worked with the Tata group for several years, Lord Bhattacharyya is an advisor to many companies and organisations around the world. With his interests in reinvigorating Britain's manufacturing through research, he is expected to play a vital role in zeroing in on a successor. Since the Tata group has a large manufacturing set up, his inputs could be crucial in the hunt for a successor.