Ratan Tata, one of India’s most powerful and admired industrialists who transformed his family’s business conglomerate, the Tata Group, into a multinational corporation with globally recognised brands, died in Mumbai on Wednesday. He was 86.
The Tata Group announced his death in a statement, which did not specify a cause. He had been treated in a critical care unit of a hospital, Reuters reported.
During his 21 years as chairman and chief executive, from 1991 to 2012, the Tata Group’s profits multiplied 50 times, with most revenues coming from sales abroad of such recognizable Tata products as Jaguar and Land Rover vehicles and Tetley teas.
Despite the conglomerate’s international outreach, its impact at home remained greater than ever under Mr. Tata’s leadership. For middle-class Indians, it was almost impossible to get through the day without buying Tata goods and services. They awoke to Tata tea, surfed the internet with Tata Photon, watched Tata Sky programs on television, rode in Tata taxis or drove their own Tata cars, and used uncounted products made with Tata steel.
Beginning in the 2010s, other family-led business groups rivaled or overtook the Tata Group in revenues and valuation. But none of the new magnates enjoyed the public esteem of Mr. Tata, who was renowned for disbursing a majority of his wealth to philanthropy and for his investments in startup businesses by young, underfinanced entrepreneurs.
The unusual ownership structure of the Tata Group added to Mr. Tata’s allure. The parent company, Tata Sons Pvt. Ltd., held the majority shares and was itself two-thirds-owned by philanthropic trusts endowed by Tata family members.
India’s prime minister, Narendra Modi, called Mr. Tata “a compassionate soul and an extraordinary human being” on Wednesday night, saying he had “an unwavering commitment to making our society better.”
Mr. Tata preferred to stay out of the limelight and projected a public image of a shy loner, a man who never married or had children. But he became ensnared in a major controversy late in his career when he convinced Tata’s board to oust his handpicked successor. The ensuing legal controversy took years to resolve and was a subject of constant media attention.
Ratan Naval Tata was born on Dec. 28, 1937, in Bombay, now Mumbai, during the British Raj. His family belonged to the Parsi ethnic community, whose Zoroastrian ancestors fled persecution in Persia centuries ago and found refuge in India.
The Tatas made their fortune in the 19th-century opium trade with China and in textile mills. By the time Ratan’s father, Naval Tata, rose to become deputy chairman of the family business, the Tata Group was entrenched in scores of manufacturing and commercial enterprises.
Tata Marriage
Naval Tata married a cousin, Sooni Tata, but they separated when Ratan and his younger brother, Jimmy, were still children. Both boys were raised and adopted by their wealthy paternal grandmother.
“I had a happy childhood, but as my brother and I got older, we faced a fair bit of ragging and personal discomfort because of our parents’ divorce, which in those days wasn’t as common as it is today,” Mr. Tata recalled in a three-part Facebook interview posted in 2020.
Tata Education
He grew up in a white Baroque revival-style building in Mumbai known as Tata Palace, with a staff of 50 servants, and was driven to school in a Rolls-Royce. He was sent to the United States for high school at the Riverdale Country School in New York City. He graduated from Cornell University with an architecture degree and later took management courses at Harvard University Business School.
Mr. Tata maintained a subdued social life. He devoted much of his leisure time to driving sports cars, piloting planes and racing his speedboat out of the harbor near an apartment he kept in Mumbai.
His survivors include his stepmother, Simone; his younger brother, Jimmy; a half brother, Noel; and two half sisters, Shireen and Deanna Jejeebhoy.
Mr. Tata joined the family business in 1962, initially working on the shop floor of Tata Steel. He then rose steadily through management positions. His single setback was at the conglomerate’s troubled electronics subsidiary, which he initially succeeded in turning around only to have it collapse during an economic slowdown. Years later, the subsidiary, Nelco, again became profitable, especially in satellite communication.
In 1991, J.R.D. Tata stepped down after a half-century as chairman of Tata Sons and the Tata Group, and turned over leadership of the conglomerate to Ratan Tata, who belonged to a different branch of the Tata family.
The succession was bitterly opposed by other Tata family members and business managers. “J.R.D. got clubbed with nepotism and I was branded as the wrong choice,” Mr. Tata said in his Facebook interview.
Mr. Tata quelled resistance and consolidated his leadership by forcibly retiring older Tata executives (softening the blow with generous pensions), making subsidiaries report to the group office, and embarking on a globalization of the family businesses.
He tapped into a nationalistic groundswell by pursuing a so-called “reverse colonialism” — the acquisition of British-based brand-name companies like Jaguar, Tetley and Corus Steel.
“Britain has become an ‘insourcing’ hub for Ratan Tata: a base for foreign operations of an Indian multinational,” The Guardian wrote in a 2008 article.
Tata Nano
In another popular move, Mr. Tata spearheaded the production in 2008 of the Tata Nano, the world’s cheapest car, with a $2,200 price within reach of the average middle-class Indian consumer.
On turning 75 in 2012, Mr. Tata surrendered his executive functions in the Tata Group. In what was supposed to be a smooth transition, he appointed as his successor Cyrus Mistry, 44, whose family was the largest individual shareholder in the conglomerate.
Instead, the succession turned into the most high-profile corporate controversy in India’s recent history. As they had two decades before when Ratan Tata was named the group’s successor, other Tata family and board members opposed the choice of Mr. Mistry. But with Ratan Tata’s support, Mr. Mistry won out.
Over the next few years, however, tensions mounted between Mr. Mistry and Mr. Tata, who still exercised strong influence as chairman of the Tata Trusts, which controlled most of the conglomerate’s shares. Mr. Mistry divested several businesses that Mr. Tata had supported, and Mr. Tata disapproved of Mr. Mistry’s handling of the group’s international steel business and telecommunications ventures.
In October 2016, less than four years after being appointed to head the Tata conglomerate, Mr. Mistry was ousted by Tata’s board with the full backing of Ratan Tata. Mr. Tata retook his position as chairman of the conglomerate until a successor was named by the board in February 2017.
But Mr. Mistry did not go quietly. He sued the Tata group on the grounds that his removal was illegal. His allegations that the board fostered nepotism, ignored minority shareholders and tolerated misdeeds were given often sensational media coverage over the next five years.
Initially, the courts ruled in Mr. Mistry’s favor. But in 2021, the Supreme Court of India finally affirmed the legality of Mr. Mistry’s dismissal, ending the saga.
The controversy detracted attention from Mr. Tata’s far-reaching philanthropies. In India, he disbursed much of his personal fortune on education, health and agricultural projects for poorer Indians. In the United States, he and Tata Trusts contributed millions of dollars to several universities — including his alma maters Cornell and the Harvard Business School — for research facilities and scholarship programs that carry the Tata name.
Enterprise and philanthropy had been at the heart of the Tata empire since its inception in 1868 by its founder, Jamsetji Tata. Jamsetji’s factories were among the first in the world to invest substantially in employee welfare, and he and his two sons left most of their estate and shares in the company to charitable trusts.
Mr. Tata backed more than 50 startup companies in India, including e-commerce and digital payment platforms and an online lingerie retailer. But his favorite was a startup called Goodfellows, which encouraged friendships between older and younger Indians in business and other professions.
At the launch of Goodfellows in Mumbai in 2022, he told an intergenerational audience, “You don’t mind getting old until you get old, and you find it’s a difficult world.”
Spread the love
Neal Bhai
Neal Bhai has been involved in the Bullion and Metals markets since 1998 – he has experience in many areas of the market from researching to trading and has worked in Delhi, India. Mobile No. - 9899900589 and 9582247600
