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Two group firms drop Tata name

Reeba Zachariah & S Ravindran in Mumbai | May 10, 2004 08:06 IST

In a move that has sparked considerable speculation, two Tata group companies have dropped the Tata name. The Rs 54,000 crore (Rs 540 billion) group's realty company, Tata Housing Development Company, has been rechristened THDC Ltd.

Tata Consulting Engineers has changed its name to TCE Consulting Engineers. Neither company operates in the group's core business areas.

A senior Tata group executive confirmed the development and said the board of Tata Housing had changed the company's name on March 15, 2004. Tata Consulting Engineers changed its name earlier.

The executive said property development was not a core business for the group. He, however, cautioned that the group had not taken any policy decision on dropping the Tata name in the case of group companies that didn't operate in core business areas.

"There has been no policy decision on this issue but we will look at it on a case-to-case basis," other senior Tata group sources said. They added that the group would look at other small group companies and decide whether these should carry the Tata tag.

Tata Consulting Engineers used to be a division of Tata Sons, the group's holding company, till about three years ago. It was then spun off as a separate company.

At that time, the Tata group executive said the group had decided that only the big Tata companies should have the Tata name. "That was implied, though not stated," the Tata group source said.

Asked whether the group would hawk the two companies, the source said: "If a good offer comes along for these sorts of companies, we may consider it. But there's nothing on the cards now."

The Tata group has 80 companies in its fold that includes giants like Tata Motors, Tata Steel, Tata Power and Videsh Sanchar Nigam. But it also has a plethora of smaller companies.

The group has a Tata brand equity scheme with a two-tiered system -- companies that bear the Tata name pay 0.25 per cent of their sales as royalty to Tata Sons; the others like Voltas and Rallis India pay 0.15 per cent.


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