Mumbai, July 23 (IANS) Reliance Industries (RIL) may raise its stake in the Oberoi Group of Hotels’ flagship entity EIH Ltd, by acquiring part or all of ITC’s stake, people in the know said.
FMCG-to-hospitality major ITC currently holds 16.13 per cent stake in the EIH.
RIL, as of June-end, had 18.53 per cent stake and can acquire a little over 6 per cent stake in the EIH from ITC without triggering an open offer.
According to industry sources, RIL’s intent to acquire more stake has been made known to ITC Chairman Sanjiv Puri.
Mukesh Ambani-led RIL, however, is unlikely to trigger an open offer at the moment.
Sources said that P.R.S. Oberoi, the Executive Chairman of EIH, would decide on a mutually acceptable agreement for ITC, and RIL, the promoters of EIH.
In 2010, Oberoi had brought in the RIL as an investor to resist a hostile takeover by ITC, which was then headed by Y.C. Deveshwar. Now, ITC, under the leadership of Puri, is believed to be reviewing its investment in EIH.
According to sources, RIL had come into the EIH scheme of things with a promise that it would never go ahead with open offer for the company, which is also believed to be documented in the agreement signed between the parties concerned in 2010.
As ITC is only an equity investor in the EIH right now, with its just over 16 per cent stake, people in the know say that it is considering an exit and plans to eventually divert the investment elsewhere.
RIL, however, declined to comment on the reported developments and a spokesperson said: “As a policy, we do not comment on media speculation and rumours.”
“Our company evaluates various opportunities on an ongoing basis. We made and will continue to make necessary disclosures in compliance with our obligation under SEBI (Listing Obligations and Disclosure Requirements) Regulations,” the spokesperson added.