ITC to hive off hotels biz into separate entity
New Delhi, July 24
Diversified entity ITC Ltd on Monday said it will demerge its hotels business by incorporating wholly owned subsidiary ITC Hotels Ltd, paving way to attract appropriate investors and strategic partners.
With the company’s hotels business maturing over the years, the company said the vertical is ready to chart its own growth path as a separate entity in the fast-growing hospitality industry.
“The Board of Directors of ITC Ltd at its meeting held on July 24, 2023, evaluated and discussed various alternative structures for the hotels business. After due consideration, the Board accorded its in-principle approval to the demerger of hotels business under a scheme of arrangement,” the company said in a regulatory filing.
The scheme of arrangement shall be placed for approval of the Board at its next meeting to be convened on August 14, 2023.
“Creation of a hospitality focused entity will engender the next horizon of growth and value creation by harnessing the exciting opportunities in the Indian hospitality industry. In the proposed reorganisation, both ITC and the new entity will continue to benefit from institutional synergies,” ITC chairman Sanjiv Puri said. — PTI
Scheme of arrangement
- The company’s Board has also approved the incorporation of the wholly owned subsidiary ITC Hotels Ltd, which will handle its hotels and hospitality business
- ITC will hold about 40% stake in the new entity and the balance shareholding of about 60% would be held directly by the company’s shareholders proportionate to their shareholding in it
