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ITC Ltd has announced the consolidation of its shareholding in EIH Ltd and HLV Ltd as part of its plan to demerge its hotel business.
ITC 's board has approved the acquisition of equity shares from its wholly owned subsidiary, Russell Credit, to facilitate this consolidation and is subject to approval from its board of directors.
This move will increase ITC's stakes in EIH, the owner of the Oberoi and Trident brands, to 16.13%, and in HLV, the operator of Leela Hotels, to 8.11%.
The transaction involves ITC acquiring 1.52 crore (15.2 million) equity shares of EIH and 34.60 lakh (3.46 million) equity shares of HLV from Russell Credit at book value.
Currently, ITC holds 13.69% in EIH and 7.58% in HLV while Russell Credit owns 2.44% and 0.53% stakes in the respective companies, reported CNBC18.
Furthermore, ITC's board has also approved the purchase of the entire share capital of Greenacre Holdings, an unlisted subsidiary of Russell Credit.
The acquisitions are steps in ITC's preparation to demerge its hotel business into a new entity named ITC Hotels, which will oversee more than 140 luxury properties under various brands.
The demerger, which received shareholder approval in June 2024, is progressing as planned and is expected to be completed in the coming months. Initially approved by the board in August 2023, the arrangement will result in ITC retaining a 40% stake in the new entity, with the remaining 60% owned by its shareholders, who will receive one share of ITC Hotels for every ten shares held in ITC.
"ITC to acquire stake in EIH and HLV from Russell Credit" was originally created and published by Hotel Management Network, a GlobalData owned brand.
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