Taj Kerala Hotels and Resorts Ltd, a joint venture between The Taj Group and the government of Kerala, is offering a 22 per cent stake to a Mauritius-based investment firm Amaind Investments.
While The Indian Hotels Company Ltd (IHCL), the Taj group flagship, and its associates including Covelong Hotels and the Magnum group together hold about 67 per cent stake in the company, the remaining 33 per cent is held by Tourism Resorts Kerala Ltd, which in turn is a wholly owned subsidiary of Kerala Tourism Development Corporation.
Sources said IHCL and associates will renunciate one-third of its entitlement in the proposed rights issue in favour of the Mauritius-based company.
Amaind Investments will be investing Rs 11.16 crore (as foreign direct investment) to pick up the 22 per cent stake in Taj Kerala. More about Amaind could not be ascertained.
A Taj official said Amaind Investments does not have any financial stake in the joint venture at present.
It is learnt that the Taj Kerala has already sought permission of the Foreign Investment Promotion Board (FIPB) to bring in the foreign direct investment.
Meanwhile, after a proposed rights issue, which is expected to be completed within the next two months, the equity base of Taj Kerala will increase to Rs 50 crore.
The money raised through the rights issue will be used to expand its portfolio from the present four hotels to six in the near future. Part of the proceeds will also be used to refurbish the existing properties.
The joint venture already has four operative hotel projects in Kumarakom, Thekkady, Varkala and Kochi. The Kerala Tourism Development Corporation has invested close to Rs 6 crore in the venture.
The new projects are being planned at Munnar and Bekal. The Bekal project expected to be operational next near is being developed as a five-star property.
There is also a plan to take the company public whenever the market conditions improve. It was, therefore, decided to pump in additional investment in the company and expand the property portfolio before the company was taken public. Sources said that according to the existing agreement, the stake of Kerala Tourism Development Corporation will come down from the present 33 per cent to 20 per cent whenever the company goes public.
The Taj group has identified Kerala as its focus area along with Goa and Rajasthan. The company recently refurbished all its existing properties in Kerala including Fisherman's Cove, Taj Malabar at Kochi and Taj Yacht to bring them in tune with the international standards.
