EIH Ltd, owners of the Oberoi hotel brand, may have a succession plan in place in the next couple of years, said P R S Oberoi, chairman.
“I think about it all the time. I intend to do something at an appropriate time..may be in a year or two,” he said, to queries at a press conference on the sidelines of the company’s annual general meeting. His son, Vikram Oberoi, and nephew, Arjun Oberoi, are both joint managing directors of EIH Ltd.
Asked whether the group was looking to create a second powerhouse in EIH Associated Hotels as part of the succession plan, since some of the assets had been transferred there, Oberoi said there were no such plans but nothing was impossible.
The group has charted a growth plan through managing properties. At present, the company has two managed properties, but over the next five years, it could become as much as 50 per cent of the group’s portfolio of properties, was the indication. The projects in the pipeline had virtually no cash requirements.
The group is not looking to sell stake. There was no concentrated effort to look for a partner. However, if somebody believed in the ideology of the Oberoi brand, things could be different, the chairman said.
“Post-Analjit Singh, we are not looking at anything. There had been some casual discussion. Point is, we were looking for a partner who can together (with us) grow this business. At that point of time, we were doing a project at Analjit Singh; that is where it stemmed from. If tomorrow someone says that he is prepared to invest in 20 hotels, we will manage, we will see,” said S S Mukherjee, vice chairman.
Asked about a partnership with ITC, Oberoi said there was no such proposal. At the ITC annual general meeting last year, Chairman Y C Deveshwar had suggested joining hands for a joint ownership or for marketing. In EIH, ITC’s holding is at the threshold limit of 14.98 per cent, a shade less than the 15 per cent that would trigger a mandatory open offer according to the Securities and Exchange Board of India regulations.
However, Oberoi is not worried. Recently, Deveshwar said ITC was against hostile takeovers. Oberoi’s stake in EIH was at a comfortable level, at around 46 per cent. The company would continue increasing stake through the creeping acquisition route.
