Summary:
- IHCL sold its 25.52 percent stake in Taj GVK Hotels & Resorts Ltd for $65.7 million.
- The stake was sold to executive director and promoter Shalini Bhupal.
- IHCL will continue operating the hotels under the existing agreements.
INDIAN HOTELS CO. Ltd., which operates the Taj chain, told the stock exchange that it sold its entire 25.52 percent stake in Taj GVK Hotels & Resorts Ltd to executive director and promoter Shalini Bhupal for $65.7 million. The stake, comprising 16 million shares, was sold at $4.11 per share, ending IHCL’s ownership in Taj GVK.
Following the transaction, IHCL, Shalini Bhupal, the GVK promoter family and the company signed a termination agreement, cancelling the 2011 shareholders’ agreement and the 2007 name and trademark license agreement, IHCL said in the filing. IHCL’s nominee directors stepped down from the board effective Dec. 30. It will remove “Taj” from its name and adopt a new corporate identity.
However, IHCL will continue operating the hotels under the existing operating agreements. In December, the company announced that it would convert the joint venture with the GVK-Bhupal family into a long-term management model.
The GVK-Bhupal family, holding a 74.99 percent stake, will remain the company’s promoter.
IHCL said it will continue managing the company’s six hotels and an upcoming Bengaluru property under its capital-light growth strategy, despite exiting as a shareholder. Meanwhile, the move allows IHCL to focus on hotel management while reducing direct equity investments, according to The Statesman.
IHCL recently partnered Taj InnerCircle–NeuPass with Shangri-La Circle and MyMillennium loyalty programs of Shangri-La Hotels & Resorts and Millennium Hotels & Resorts.
