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Over 99% of ITC's minority shareholders approve hotel business demerger
More than 99% of the tobacco and consumer product giant’s minority shareholders voted to separate its hotel business.
ITC’s shareholders approved the plan to separate or demerge the hotel business, Reuters reported.
About 99.6% of the company's minority shareholders voted in favour of the move, exceeding the regulatory requirement of a three-fourth majority.
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As per media reports, proxy advisory firms Stakeholders Empowerment Services (SES) and InGovern Research Services last month asked shareholders to support the demerger proposal, while Institutional Investor Advisory Services (IiAS) opposed the move, the article read.
"ITC must provide greater clarity with respect to the size of the synergies it expects to get by maintaining the 40% equity in the hotels business," IiAS said a voting advisory note, referring to the stake that the company will hold in ITC Hotels, the newly formed entity. ITC shareholders will own the remaining stake.
The hotels business contributed 4% to ITC's revenue during the financial year 2023-24, while its mainstay consumer staples business made up 71% of its revenue, according to the article.
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ITC announced the demerger plan in July last year and later said that the new entity would be tentatively listed in 15 months.
The company's shares closed 1.2% higher today after the announcement.
