After bringing in Mukesh Ambani’s Reliance Industries Ltd (RIL) as a white knight last year to thwart any possibility of takeover by ITC, the P R S Oberoi-led EIH Ltd appointed his wife, Nita Ambani, as an additional director on Monday.
It has also appointed Mukesh Ambani's right hand man Manoj Modi on its board as Additional Director.
In a statement to the Bombay Stock Exchange (BSE), the company said it had appointed Nita Ambani and three others as additional directors. “We have invited them to be a part of the board. But the management structure of the company remains the same, as she is in a non-executive director capacity. Even Reliance stake remains the same,” a spokesperson at EIH said.
Ambani’s inclusion to the board was being expected for sometime. Last year, RIL was brought in as a stakeholder in a surprise move to ward off any possible takeover by ITC. Since 2000, ITC has been accumulating EIH shares and has a 14.98 per cent stake, just short of the earlier Securities and Exchange Board of India-prescribed threshold of 15 per cent that triggers a mandatory public offer for another 20 per cent.
RIL checked into EIH through its wholly owned subsidiary, Reliance Industries Investment and Holding, that acquired a 14.8 per cent stake from Oberoi Hotels and promoters of EIH. RIL first picked up a 14.2 per cent stake in EIH for Rs 1,021 crore and later increased it to 14.8 per cent.
“Our (RIL and EIH) visions match,” P R S Oberoi, EIH chairman and chief executive officer, had said at a press conference here, following the firm’s 61st annual general meeting in August. He had outlined the possibility of taking the relationship forward, by indicating a joint venture for developing luxury residential apartments in Bangalore and Goa. Expressing full faith and confidence in the partnership, Oberoi even dubbed RIL as a “friendly shareholder”.
The Oberoi group has a 34.5 per cent stake. However, the new takeover code, which has been notified, has increased the threshold level from 15 per cent to 25 per cent. So, RIL and ITC will be able to increase their holdings without triggering an open offer.
EIH net profit at Rs 16.6 crore
The company on Monday reported a net profit of Rs 16.59 crore for the second quarter ended September 30, compared to a net loss of Rs 15 crore in the same period last year. Net sales zoomed 11.02 per cent to Rs 217 crore.
