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ITC Demerger: ITC Hotel to Be Listed Within 60 Days of NCLT Approval

Updated on: Dec 31, 2024, 3:19 PM IST
The demerger of the hotel business of ITC into ITC Hotels, which has been sanctioned by the NCLT, will come into effect on January 1, 2025.
ITC Demerger: ITC Hotel to Be Listed Within 60 Days of NCLT Approval
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ITC Ltd, a diversified conglomerate, announced on Monday (December 30) that its hotel business, ITC Hotels, will be listed on stock exchanges within 60 days of receiving the National Company Law Tribunal (NCLT) order, dated December 16, 2024.

The demerger of ITC’s hotel business into ITC Hotels, which has been sanctioned by the NCLT, will come into effect on January 1, 2025. January 6, 2025, has been set as the record date to determine which ITC shareholders will be eligible for the allotment of ITC Hotels equity shares.

Ownership and Asset Transfer Details

Under the arrangement, existing ITC shareholders will hold 100% of ITC Hotels, with approximately 60% of the shares being directly owned and the remaining 40% held indirectly through ITC. The demerger will see all properties, assets, employees, and contracts related to the hotel business transferred to ITC Hotels.

Key intellectual properties, including renowned trademarks such as Bukhara, Dum Pukht, and Dakshin, will also transition to ITC Hotels under a licensing agreement with ITC. Additionally, significant assets such as investments in Fortune Park Hotels, Srinivasa Resorts, and ₹1,500 crore in cash reserves will be moved to ITC Hotels to support future growth.

Investments and Listing Process

However, ITC’s financial investments in EIH Ltd and HLV Ltd will remain with the parent company, ITC. After the allotment of shares to ITC shareholders, ITC Hotels will apply to the stock exchanges and SEBI for listing approval. The listing process is expected to be completed within 60 days of the NCLT order, in compliance with SEBI regulations.

The demerger proposal was approved by ITC shareholders in June this year, with 99.6% approval from public institutions and 98.4% approval from public non-institutional shareholders.

 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in securities market are subject to market risks, read all the related documents carefully before investing.

Published on: Dec 31, 2024, 11:58 AM IST

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