Kolkata, Aug 14 (PTI) Diversified entity ITC Ltd on Monday said shareholders will get one equity share of ITC Hotels for every 10 shares held in the demerged company (ITC Ltd), according to the entitlement ratio.
At the board meeting of ITC Ltd held on Monday, it was decided that issuance of equity shares by the resulting company ITC Hotels Ltd to the shareholders of the demerged entity will be in the ratio of 1:10, as per a regulatory filing by the firm.
The company said the scheme of demerger comprising hotels business of the demerged company into the resulting entity is on a going concern basis.
Giving the rationale for the demerger, ITC said it is a diversified company engaged in various businesses including hotels.
“The hotels business of ITC has matured over the years and is well poised to chart its own growth path and operate as a separate listed entity in the fast-growing hospitality industry, whilst continuing to leverage ITC’s institutional strengths, strong brand equity and goodwill,” it said in the filing to the bourses.
The firm said the demerger would be in the best interests of the two companies and their respective shareholders and other stakeholders.
ITC Hotels will have the ability to raise capital from equity and debt markets for funding its growth requirements. Following the demerger, there will be no change in the shareholding pattern of ITC.
Post the implementation of the scheme of arrangement, the shareholders of ITC Ltd will directly hold 60 per cent in ITC Hotels Ltd, and the balance 40 per cent by ITC.
The scheme will also unlock the value of the hotels business for the existing shareholders of ITC Ltd through independent market-driven valuation of their shares, which will be listed on the BSE and NSE in the next few months. PTI DC RBT
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