ITC Acquires Stakes in EIH and Leela Mumbai for ₹111 Crore Ahead of Hotel Business Demerger

Kolkata: ITC Ltd, which is set to demerge its hotels business by January 2025, has consolidated its shareholding in two rival hospitality chains, EIH and HLV, through acquisitions from its wholly-owned subsidiary, Russell Credit Ltd.

In a regulatory filing on Wednesday, ITC announced the acquisition of a 2.44% stake in EIH (1.52 crore equity shares of ₹2 each) and a 0.53% stake in HLV (34.60 lakh equity shares of ₹2 each) for a total of ₹111 crore. With this transaction, ITC now holds 16.13% of EIH and 8.11% of HLV’s paid-up share capital.

EIH, the parent company behind luxury hospitality brands Oberoi and Trident, and HLV Ltd, which owns The Leela Mumbai, are key players in the premium hospitality segment. ITC clarified that the acquisitions were conducted at book value recorded in Russell Credit’s accounts.

The ITC board had earlier approved the consolidation of EIH and HLV shareholdings under ITC as part of its broader demerger strategy, which was sanctioned by the National Company Law Tribunal (NCLT) in October 2024. Shareholders had already voted in favor of the demerger, which will establish ITC Hotels Ltd as a separate entity to manage the conglomerate’s hospitality business.

According to ITC, the demerger will officially take effect on January 1, 2025, with January 6, 2025, set as the record date for determining ITC shareholders eligible to receive ITC Hotels equity shares. The demerger structure allows ITC shareholders to hold a 60% direct stake in ITC Hotels, while ITC retains the remaining 40%.

Under the demerger scheme, investments in key hospitality entities—including Bay Islands Hotels Ltd, Fortune Park Hotels Ltd, Landbase India Ltd, Srinivasa Resorts Ltd, WelcomHotels Lanka Pvt Ltd, Gujarat Hotels Ltd, International Travel House Ltd, and Maharaja Heritage Resorts Ltd—will transfer to ITC Hotels.

This move marks a significant milestone in ITC’s diversification and corporate restructuring strategy, with its hotel business set to function as an independent entity while maintaining synergies with the parent company.