Prithvi Raj Singh Oberoi, the patriarch of the Oberoi Group, has handed over the overall management responsibility of EIH to close aide Shib Sanker Mukherji and has himself decided to become an advisor and guide while retaining the chairmanship of the company.
"The overall management responsibility and authority is handed over to Mr. S. S. Mukherji", a statement from EIH (formerly East India Hotels), which manages most of the luxury hotels and resorts under the Oberoi brand in India and abroad.
P. R. S. Oberoi (83), who is also known as Biki Oberoi, will remain as the Executive Chairman and will look after the development of future projects of the company and continue to advise and guide the Vice Chairman & Chief Executive Officer and other Executive Directors, as and when required, the statement added.
Speculations about the senior Oberoi stepping down from active responsibilities and handing over the company reins to his eldest son Vikramji Singh Oberoi were ripe some months ago. However, Vikramjit continues to be EIH's chief operating officer and joint managing director as earlier.
In an interview given in 2011 to a media house, Oberoi had stated that Vikram, a graduate from Pepperdine University, United States, will take over the reins from himself after retirement. However, the company later clarified that PRS Oberoi will continue to lead senior executive team led by Mukheji and Vikram.
Mukherji, who has been with the Oberoi group for more than four decades, and was promoted to the post of vice chairman in 2007, will assume the additional responsibility of chief executive, with immediate effect, the company clarified.
Mukherji who is a member of the Institute of Chartered Accountants of India, is considered to be amongst the senior most employees of EIH after Oberoi himself. Mukherji has completed an Advanced Management Programme from Harvard University in the United States.
One of the biggest challenges for the Oberoi group lies in overseas expansion. The company which has a rather limited presence in India itself aims to put up hotels in New York and other similar places for better brand exposure.
The company has 11 properties under the luxury Oberoi brand in India and ten hotels under the Trident brand, which represents upmarket business hotels. It also has seven properties across five nations such as Egypt, Indonesia, Mauritius, Saudi Arabia and United Arab Emirates.
Like other Indian chains such as Taj, Leela and ITC, the Oberoi group too has been feeling the pressure of competition from international chains like Marriott, Hyatt, Intercontinental, Accor, Hilton to name few, in its own backyard. Rapid expansions by these international chains have led to stagnation of increase in room rates for sometime.
Reliance Industries Investment and Holdings hold 18.53 per cent in EIH and is the second largest shareholder while the Y C Deveshwar-led, ITC holds 14.98 per cent in the company. The promoters hold 35.23 per cent in EIH, as of December.