In a significant development within India's premier business conglomerate, former Tata Group director Simone Tata transferred a substantial portion of her assets, including her shares in Tata Sons, to her son and Tata Trusts chairman Noel Tata several years ago. This move has solidified Noel Tata's position as the single largest shareholder from the Tata family within the group's key holding company.
A Strategic Transfer of Wealth and Shares
The transfer, which involved assets beyond just shares, has had a direct impact on the ownership structure of Tata Sons, the pivotal holding company of the $180-billion Tata Group. Noel Tata now holds 4,058 shares in Tata Sons, a significant increase from the 2,055 shares he held previously. This elevates his stake to approximately 1%, granting him the top spot among Tata family shareholders in the company.
This adjustment in shareholding brings Noel ahead of his late half-brother, Ratan Tata, who held 3,368 Tata Sons shares, equivalent to a 0.83% stake. Ratan Tata bequeathed his shares to his philanthropic foundations, the Ratan Tata Endowment Foundation and the Ratan Tata Endowment Trust (RTET), in a 70:30 ratio. Interestingly, Noel Tata also serves as a trustee of RTET.
Understanding the Tata Family Shareholding Landscape
The shares held by Simone, Noel, Ratan, and another half-brother, Jimmy Tata, were originally inherited from Naval Tata. Ratan and Jimmy were his children from his first marriage to Soonoo Commisariat, while Noel is his son from his second marriage to Simone. Jimmy Tata currently owns 3,262 Tata Sons shares, representing a 0.81% stake.
Other members of the extended Tata family, including Piloo Tata (wife of the late Minocher Tata) and their children Jimmy Tata (chief credit officer at HDFC Bank) and Vera Choksey, collectively hold 801 shares in Tata Sons.
Of the 2,011 Tata Sons shares originally held by Simone Tata, she transferred 2,003 shares to Noel. The status of the remaining eight shares is unclear—they may still be in her name or may have been gifted to Noel's three children.
Tax Implications and Property Assets
A key financial aspect of this intra-family transfer is its tax efficiency. A tax expert highlighted that "gifts to blood relatives either during the donor’s lifetime or through a will are exempt from capital gains tax," making such transfers a prudent estate planning tool.
The asset transfer was not limited to financial instruments. Simone Tata also gifted her real estate holdings in Geneva and Mumbai to Noel and his family. This includes a 3,000-square-foot apartment in Mumbai's upscale Colaba area, which she purchased in the Bakhtawar building after the Tata family sold their historic Fort residence, Tata House, to Deutsche Bank back in 1992. Notably, Noel Tata also owns an apartment in the same building.
This consolidation of shares and assets underscores a strategic passing of the torch within one branch of the Tata family, ensuring a clear and strengthened ownership position for Noel Tata in the sprawling Tata empire.
