Oberois to raise stake in EIH; firm plans Rs.1.5 bn investment (Lead)August 24th, 2010 - 7:13 pm ICT by IANS
Kolkata, Aug 24 (IANS) The Oberois, founders of East India Hotels Ltd, are planning to raise their stake in the company every year.
“We have 46.4 percent stake now. We plan to raise stake gradually,” Chairman P.R.S. Oberoi told reporters here Tuesday after the annual general meeting of the company.
The company can raise up to 5 percent stake every year through creeping acquisition.
Asked whether he plans to raise stake in the current financial year, he said: “If due to some extraneous reasons market goes down may be in few months we will acquire.”
Speculations are rife that cigarettes-to-hotels conglomerate ITC, which holds 14.98 percent stake in EIH, may try to take over the company.
ITC, however, has said it would not go for any open offer for EIH.
”If we touch 15 percent, we then have to go for additional 20 percent, which means we have to take up at least 35 percent, which we wouldn’t do,” ITC Chairman Y.C. Deveshwar had said a month ago.
About business, Oberoi said EIH would now concentrate more on management contracts.
“We feel that we own too much property and from now on we would be managing others’ properties rather than owning them,” he said.
In the coming five years, the company plans to make management contracts 50 percent of its total business.
At present, EIH has 32 properties gloablly. Of these, 22 are in India. Of the 22, 11 are under the Oberoi brand, nine are under the Trident brand and two are unbranded.
Oberoi said the company would invest Rs.150 crore over the next two years on various projects.
It would also scout for properties in Shanghai, Beijing, Bangkok, London, Paris and New York, he said.
Oberoi is hopeful that the sales would pick up from September-October and the average room rates would go up by 8-10 percent.
“We expect the Europeans, particularly those from France, Italy and the UK to again start coming to India during the winter,” he said.
On the succession plan, Oberoi said, he would take a call within two years.
“I think of it all the time and would like to decide on it in the next two years,” he said.
Oberoi has inducted son Vikram and nephew Arjun in the board of EIH.
- RIL acquires 14.12 percent in East India Hotels - Aug 30, 2010
- ITC yet to take call on EIH rights issue - Oct 06, 2010
- No open offer for EIH: Deveshwar - Jul 23, 2010
- East India Hotels plans tie-up with RIL - Aug 10, 2011
- 'Asset-heavy' EIH to focus more on managing hotels - Aug 07, 2012
- No plans of sell stake: EIH Chairman - Jul 09, 2010
- ITC not to make takeover bid on East India Hotels - Jul 24, 2009
- ITC trying to 'fast forward' Rs.25,000 crore investment plan - Jul 27, 2012
- WBIDC to hand over land to ITC for production base - Sep 14, 2010
- FMCG business to be profitable in six years: ITC - Jul 29, 2011
- ITC aims to create multiple Indian FMCG brands: Deveshwar - Jul 27, 2012
- Oberoi Group opens hotel in Gurgaon - Apr 12, 2011
- India should not suffer grid collapse: Deveshwar - Aug 01, 2012
- Oberoi Group denies reports on P.R.S Oberoi's successor - Apr 12, 2011
- ITC shuts down two WIMCO plants - Jul 29, 2011
Tags: acquisition, annual general meeting, bangkok, beijing, cigarettes, coming to india, conglomerate, crore, east india, europeans, founders, itc, london paris, management contracts, oberoi, percent stake, shanghai, speculations, succession, trident