ITC shareholders approve demerger of hotel business
06 Jun 2024
Diversified group ITC Ltd on Thursday said 99.6 per cent of its shareholders approved the demerger of its hotels business which will be listed as a separate entity. A minority 0.4 per cent shareholders voted against the proposal, according to a stock exchange filing.
ITC said the resolution for approval of a scheme of arrangement to hive off the hotels business was passed by remote voting by shareholders and creditors, the filing stated.
The demerger is in the split ratio of 10:1, ie, for every 10 equity shares of Re1 each held in ITC Ltd one equity share of Re1 paid-up value in ITC Hotels.
After completion of the demerger process, ITC's stake in ITC Hotels will be reduced to 40 per cent. The shareholders of ITC will hold about 60 per cent of ITC Hotels.
ITC Hotels reported record high revenue and profit during the January-March 2024 quarter. ITC said segmental revenue for the hotels business grew 15.6 per cent to Rs2,989 crore and operating profit jumped 26.2 per cent to Rs1,049 crore.
ITC’s overall net profit, however, declined 1.31 per cent year-on-year to Rs5,020 crore, while revenue rose modestly by 1.4 per cent to Rs17,752 crore. The company declared a final dividend of Rs7.50 per share for the financial year 2024.
Launched in 1975, ITC Hotels has carved a niche for itself with its commitment for `Responsible Luxury’ which effectively combines nature with elements of luxury to add value to its services. The planet positive initiatives have made ITC Hotels a pioneer in ecofriendly hospitality.
In April this year, ITC Hotels announced its first overseas expansion with Colombo property ITC Ratnadipa. It is also the company's largest investment.
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