ITC to consolidate shareholding in Oberoi, Leela chains directly under itself
The company has approved consolidating its stake in rival hospitality chains Oberoi (EIH) and Leela (HLV) by acquiring shares from its subsidiary, Russell Credit Ltd. This move increases ITC's holdings to 16.13% in EIH and 8.11% in HLV
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New Delhi: ITC Ltd, currently in the process of demerging its hotels business, on Thursday said its board has approved consolidation of its shareholding in rival hospitality chains Oberoi and Leela by acquiring shares from a wholly-owned arm, Russell Credit Ltd. The board approved the acquisition of 1.52 crore equity shares of Rs 2 each of EIH Ltd (EIH) and 34.60 lakh equity shares of Rs 2 each of HLV Ltd (HLV), from Russell Credit Ltd (RCL), a wholly-owned subsidiary of the company, at their respective book value, ITC said in a regulatory filing.
EIH Ltd owns and operates hospitality properties under brands, including Oberoi and Trident, while HLV Ltd operates a chain of luxury properties under the Leela brand. The step has been taken to consolidate the shareholding of EIH and HLV under the company, ITC said in a regulatory filing. Post such acquisition, "the total shareholding of ITC in EIH and HLV would be 16.13 per cent and 8.11 per cent, respectively". ITC currently holds 13.69 per cent in EIH while RCL holds a 2.44 per cent stake. In HLV Ltd, ITC holds a 7.58 per cent stake. The company further said its board also approved "acquisition from RCL of the entire share capital of Greenacre Holdings Ltd, an unlisted company and a wholly owned subsidiary of RCL, at book value".
The acquisitions will be subject to relevant approvals from the Board of Directors of RCL. ITC is demerging its hotel business into a separate entity. Earlier this year in June, ITC shareholders with a whopping 99.59 per cent votes approved the demerger of ITC Hotels into a separate entity. A new wholly-owned subsidiary ITC Hotels Ltd will handle its hotel and hospitality business.. Launched in 1975, the ITC hotel segment has over 140 luxury properties across 90-plus locations. It operates with six brands - ITC Hotels, Mementos, Welcomhotel, Storii, Fortune and WelcomHeritage.
