Realty firm Brigade Enterprises today announced plans to hive off its hospitality businss, which includes hotels with 500 keys, into a wholly-owned subsidiary as the company seeks to expand this vertical.
At present, the Bengaluru-based developer hold hospitality assets under the parent company, while Brigade Hospitality Services Ltd (BHSL) is into management of a range of hospitality projects, including serviced residence facilities, clubs, hotels, resorts and spas and convention centres.
In a filing to the BSE, Brigade Enterprises informed that "the Board of Directors of the company at its meeting held on June 17, 2016, has approved in-principle the hiving off of the hospitality business of the company in to a wholly owned subsidiary".
When contacted, Brigade Hospitality Director Nirupa Shankar said: "Currently Brigade Hospitality, which is a hospitality management company, is a subsidiary but the physical hotel assets are still a part of the parent company - Brigade Enterprises Ltd".
"We plan to move the hotel assets into a subsidiary as we will be adding sizeable mass to our existing inventory of hotel rooms over the next three years. Currently we have about 500 rooms and in three years we plan to have about 2000 rooms in total. The new structure will be more investor friendly as well," she added.
The modalities of the hiving-off process, subject to the approval of shareholders and other regulatory approvals, would be worked out, the filing said.
The company's share price today rose by 13.57 per cent to close at Rs 179.15 apiece on the BSE.
