ITC to pump Rs8,000 crore into hotel business
25 Jul 2009
ITC Ltd, the tobacco giant that has diversified widely, has lined up an investment of Rs 8,000 crore to scale up its hotels business. The company is looking at both the organic and inorganic routes to expand and is also open to the idea of picking up a strategic stake in a hotel project.
However, ITC chairman Y C Deveshwar made it clear that the company ''is not interested in making hostile takeover bids''. This was seen as an indication of willingness to bury the hatchet with rival hotel group EIH Ltd after years of bitterness.
Speaking at the ITC annual general meeting in Kolkata, Deveshwar expressed a desire to join hands with EIH, while ruling out the possibility of making any hostile bid for the latter. ITC holds 14.98 per cent in EIH through investment arm Russell Credit.
"If they join hands with us, it would be beneficial for both," Deveshwar said.
However, he admitted to reporters later that ITC had not approached EIH about any collaborative arrangements. EIH vice-chairman S S Mukherjee too made it clear that his company had not heard anything from ITC in this regard.
Addressing the press after the AGM, Deveshvar also announced a host of other investment proposals. ''ITC is willing, able and ready to make investment in paper, hotel and the FMCG business - our future plan rests there,'' he said, adding that the Chennai Hotel, to be India's largest, will be ready by December 2010.