Tata Trusts have proposed merging Tata Engineering and Technical Services (TESS) and Tata Consulting Engineers (TCE) into Tata Sons, in a structural revamp aimed at getting the holding company out of the Reserve Bank of India’s NBFC net.

The Trusts, which own 66% of Tata Sons and are led by Noel Tata, argue the merger would fundamentally change the company’s income mix. Tata Sons’ operating revenue stands at ₹1,05,043 crore — 64.3% of total income — against ₹40,072 crore from financial assets. After the merger, investments of ₹1,77,120 crore would fall below 90% of net assets of ₹2,00,158 crore, taking it under the threshold that defines a core investment company.

The plan needs board approval and a no-objection from the RBI, after which Tata Sons would surrender its CIC registration. It comes after the RBI rejected the company’s deregistration plea on September 11, 2026, and after it missed the September 30, 2025 deadline to list under the ₹1 lakh crore asset-size rule.

The Shapoorji Pallonji Group, which holds 18.4%, has been pushing for a listing. The Trusts’ merger gambit is their boldest move yet to avoid one.