Oriental Hotels Surges Post-IHCL Merger News; IHCL Dips
By Business Desk
Oriental Hotels shares surged 5.66% following an all-stock merger announcement with IHCL, which saw its stock dip. Details on exchange ratio and timeline.
Shares of Oriental Hotels (OHL) jumped 5.66% on Monday, while Indian Hotels Company Ltd (IHCL) stock dropped 3.49% following the announcement of a merger between the two hospitality entities.
The proposed scheme details OHL’s merger with IHCL through a Scheme of Arrangement, an all-stock transaction awaiting statutory approvals. This move saw immediate market reactions across both scrips.
Key Merger & Market Figures
- Oriental Hotels stock rose 5.66% to Rs 146.40 on BSE.
- IHCL stock dropped 3.49% to Rs 707.80 per share.
- Share exchange ratio: 25 IHCL shares for every 117 OHL shares.
- Completion targeted for the second half of FY2028.
- Appointed date for the merger is April 1, 2027.
Puneet Chhatwal, MD and CEO of IHCL, stated the merger aligns with the company’s Accelerate 2030 strategy. This strategy focuses on creating value, simplifying the group’s holding structure, and unlocking the potential within OHL’s portfolio.
Chhatwal further added that the merger is expected to support long-term value creation. This will be achieved by leveraging IHCL’s robust balance sheet for strategic investments, including expanding inventory and enhancing product offerings.
Strategic Rationale and Shareholder Benefits
Pramod Ranjan, MD and CEO of Oriental Hotels, commented that OHL shareholders would significantly benefit. The merger allows them direct participation in IHCL’s growth trajectory.
Ankur Dalwani, Executive Vice President & CFO of IHCL, reiterated the all-stock nature and the specific share exchange ratio. He highlighted that the merger simplifies the group’s holding structure by increasing IHCL’s direct ownership in various entities, leading to two new operating subsidiaries.
- OHL manages seven hotels with 825 rooms.
- Freehold properties include Taj Coromandel, Taj Fisherman’s Cove Resort & Spa, and Gateway Coonoor.
- Long-term leasehold assets comprise Taj Malabar Resort & Spa, Vivanta Coimbatore, Vivanta Mangalore, and Gateway Madurai.
This restructuring aims to streamline governance, optimize overheads, and improve operational efficiency. These steps are critical to supporting the broader Accelerate 2030 objectives for IHCL.