The hotel demerger scheme is subject to many regulatory clearances. Credit: Tarun2 via Shutterstock.com.

Kolkata, India-based conglomerate company ITC’s board of directors has approved the scheme of arrangement involving the demerger of the hotel business, with the listing of the new entity anticipated in a timeline of roughly 15 months, according to Moneycontrol.

The hospitality business will have a licence to use the ITC brand name.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

As per the plan, for each ten shares held in ITC, its shareholders would get one share of ITC Hotels.

After implementation of the scheme, the ITC shareholders will roughly hold a 60% stake in ITC Hotels, proportionate to their shareholding in the conglomerate, with the remaining 40% stake in the new entity being held by ITC.

The demerger scheme is subject to many regulatory clearances, including stock exchanges, the Securities and Exchange Board of India and the National Company Law Tribunal.

However, no cash consideration is payable under the scheme of demerger.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Employees associated with the hotel business would be moved to ITC Hotels. ITC, however, has indicated that the employment terms would remain the same as the current employment terms with the company, according to Business Standard.

The company also stated that its financial investments, such as East India Hotels and Hotel Leelaventure and non-operational entities, such as Logix Developers, would not be transferred to the new entity.

Last month, the board gave its in-principle approval to the demerger of the hotels business under a scheme of arrangement.

Earlier this week, ITC posted a net profit of Rs49.03bn ($589.41m) in the June quarter of the 2024 financial year, an increase of 17.5% from the same quarter of the prior year.