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ITC Demerger Update: There is good news for the shareholders of FMCG company ITC. The company’s board has given in-principle approval for the demerger of the hotel business. The company has given this information to the stock exchange in the regulatory filing. Now the scheme of arrangement will be presented in the meeting of the board of the company on August 14, 2023 for further approval. After which announcements and public disclosures will be issued under SEBI’s listing regulations and laws.
According to the in-principle approval given to the demerger of the hotel business, the company will retain 40 per cent stake in the company with the hotel business. The remaining 60 per cent stake will be with the shareholders of ITC. Based on the holding of the shareholders in ITC, the shares of the new company will be given in that proportion.
The board of the company has also decided the name of the new subsidiary company to be separated from the parent company after the demerger. The new company has been named ITC Hotels Limited. And one rupee will be the face value of the company’s share.
Giving information about the demerger decision, ITC said that the company’s board believes that the hotel business is fully prepared to grow as a separate entity in the rapidly growing hospitality industry. The company said that the focus of the new hotel unit will be on capital formation along with business. Also, it will continue to benefit from ITC’s institutional strength, brand equity and goodwill. ITC has 120 hotels with 11,600 rooms at 70 locations across the country.
The market was waiting for this news to come out for a long time. Due to which, in the recent times, a great boom was seen in the stock of ITC. But after this news surfaced on Monday, ITC’s stock fell by 3.87 per cent and ITC’s stock market closed at Rs 470.90.
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