ITC Makes Major Decision : Big News for ITC Shareholders: Demerger of Hotel Business Announced
ITC has finally made a significant announcement that shareholders have been eagerly awaiting. The question on investors’ minds regarding when the company will unlock its value and demerge its hotel business seems to have been answered.
ITC Makes Major Decision
It has been revealed by ITC that there will be a meeting of the company’s ordinary shareholders on June 6th this year. In this meeting, the company will signal the demerger of its hotel business, as outlined in its exchange filing. The meeting is scheduled for 10:30 AM and will be conducted electronically.
ITC is preparing to separate its hotel business
NCLT has stated that a shareholder meeting will be convened to approve this proposal. Additionally, ITC shareholders will receive one share of ITC Hotels for every ten shares held, without any additional payment required.
Upon the emergence of this new entity within ITC’s portfolio, ITC shareholders will hold a 60% stake in the company. This will make ITC shareholders both shareholders of ITC Hotels and stakeholders in ITC’s other ventures.
ITC Hotel will become independent
ITC is primarily known as a cigarette company, but it has also made significant strides in the hotel business. Due to this, the company has leveraged its brand equity and goodwill to its advantage and will continue to do so in the future.
The proposed demerger of ITC Hotels is expected to be approved in June. However, it is uncertain how long it will take for the company to be listed afterward. But after that, the company will prepare to list it, whether as a subsidiary of the hotel subsidy or as an independent entity.
Once it becomes an independent company, it will no longer remain a subsidiary. ITC will retain a 40 percent stake in it. As a hotel company, it will be run independently, with the freedom to operate as it sees fit. Therefore, it is believed that the company will perform better under such circumstances. If needed, it will raise funds from the market.
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