Nairs, the promoters of Hotel Leelaventure — the holding company for Leela Palaces & Resorts — have said they are open for inching up their stake in the company despite having a comfortable majority stake of 51.50%.
This decision comes against the backdrop of ITC recently picking up 3% in Hotel Leelaventure through its investment arm, Russell Credit.
Vivek Nair, vice-chairman and managing director, Hotel Leelaventure, commenting on ITC’s move, told DNA Money, “Any company can do that as part of its treasury operations... but we may increase our stake in the future.”
Nair did not specify whether this would happen within the current fiscal or sometime in FY10, but said the option was always there to pick up 5% annually to further increase the promoters’ stake.
He said, “Any company can pick up from the floating stock of 20% with the public. But we have no fear… our promoter holding is large.” ITC had confirmed having purchased 1,13,32,090 shares in Hotel Leelaventure as “a routine treasury operation”. The value of the transaction is not known. However, it may be recalled that ITC, a key player in the hospitality business in India, had some time ago picked up 14.92% in East India Hotels, coming close to the 15% threshold which can trigger an open offer clause for buying another 20%.
ITC chairman YC Deveshwar had said at its annual general meeting in July 2008 that the diversified company, with interests ranging from tobacco, hotels, food & FMCG to paper, will continue to pick up minority stakes in competing companies as a strategy.
In the last fiscal, it had picked up 0.5% in paper maker Ballarpur Industries Ltd (Bilt) for Rs 5.6 crore. While Bilt is India’s top paper manufacturer, ITC has interests in paper and paperboards, too.
East India Hotels competes with ITC’s hotels division. ITC has a powerful portfolio of hotel brands. Through an exclusive tie-up with its partner Starwood, seven of its properties were repositioned under the premium Luxury Collection.
ITC Welcomgroup offers 90 hotels under four brand propositions — ITC Hotels, Welcom Hotel, Fortune and Welcom Heritage. Hotel Leelaventure is setting up five-star luxury properties in Udaipur, Gurgaon, Chennai, Delhi and several other places. It already has a presence in Mumbai, Bangalore, Kovalam and Goa.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}