RIL acquires 14.12-% in Oberoi's EIH; thwarts ITC
30 August 2010
Reliance Industries Ltd, India's most valuable company, has bought a 14.12 per cent stake in EIH Ltd, the operator of Oberoi Hotels & Resorts and the Trident brand, for Rs1,021 crore, the two companies said in separate statements today.
The RIL statement said that EIH (Eastern India Hotels) Ltd has excellent future prospects, as the Oberoi family has developed the 'Oberoi Hotels' brand into a premier brand in the luxury hospitality sector. ''There is no change of management, operation or control of EIH Ltd,'' the statement said.
The promoter and promoter group had a shareholding of 46.43 per cent prior to the deal. ITC Ltd, India's biggest cigarette maker and a hotel operator, owns 14.98 percent of EIH.
EIH's chairman P R S Oberoi and other shareholders sold 55.5 million shares to Reliance Industries Investment & Holding Pvt Ltd, added the EIH statement.
Commenting on the stake sale, Oberoi said, "RIL desired to make a long term financial investment in the luxury hospitality industry. We are happy to encourage their investment in EIH Ltd. There is no change to control, management or operation of EIH."
The development comes less than two months after Oberoi ruled out selling promoter stake in EIH Ltd, although he said he could not stop rival ITC from buying shares in the open market.