Sterling Holiday becomes subsidiary of Thomas Cook India
09 September 2014
Sterling Holiday Resorts has now become a subsidiary of Thomas Cook India Group with the latter raising its stake to around 55.14 per cent following the acquisition of a further 12 million shares in off-market transactions.
In its latest transaction, Thomas Cook Insurance Services (India) Ltd (TCISIL) purchased 1.19 million shares of Sterling Holiday Resorts (India) Ltd at Rs98 per share, in off-market deals, in the first week of September, taking the group's stake in resorts group to approximately 53.48 per cent. Thus, Sterling Holidays has become a wholly-owned subsidiary of Thomas Cook India Ltd, the company said in a filing with the stock exchange.
Meanwhile, another subsidiary of Thomas Cook (India), Travel Corporation (India) Ltd, has bought approximately 1.67 per cent of the paid-up equity of Sterling Holidays, taking the stake of Thomas Cook India group to 55.14 per cent of its paid-up equity share capital.
Earlier, as at the end of June 2014, Thomas Cook India group had nearly 42 per cent stake in Sterling Holiday Resorts. ''Now, the merger process will begin,'' said a senior executive of Sterling Holiday.
Thomas Cook India Ltd, India's leading integrated travel and travel related financial services company, and the 27-year old vacation ownership pioneer Sterling Holiday Resorts India Limited announced a merger between the companies in February. The transaction was expected to close by the fourth quarter of 2014, subject to customary closing conditions and regulatory approvals as required.
Under the part equity, part merger deal, TCIL Group is making a preferential allotment for approximately Rs187 crore into Sterling while TCIL Group purchases shares from Sterling shareholders for Rs176 crore.
TCIL Group will make a mandatory open offer for Rs230 crore.
The merger between the two companies has been decided on a swap ratio of 120:100.
The merger brings significant synergies to both partners - with Thomas Cook India gaining access to Sterling Resorts' network of 19 resorts in 16 holiday destinations across India and Sterling gaining customers.
The company also has 15 additional sites where it plans to add new resorts in the coming years.
Sterling's affiliation with Resort Condominiums International (RCI) - the global expert in exchange vacations, also allows its members to vacation in over 4,000 RCI affiliated resorts all over the world.