Why Taj-Parent IHCL Wants Full Control of Oriental Hotels

The company behind the Taj hotel brand, Indian Hotels Company informed stock exchanges this week that it plans to merge Oriental Hotels into itself. IHCL and its subsidiaries already own 37.1% of Oriental Hotels. So the acquisition is more about bringing an existing part of the group under one roof. Oriental Hotels owns three freehold properties — Taj Coromandel and Taj Fisherman’s Cove Resort & Spa in Chennai, and Gateway Coonoor — along with four hotels held on long-term leases: Taj Malabar in Kochi, Gateway Madurai, Vivanta Mangalore, and Vivanta Coimbatore. For years, IHCL and Oriental Hotels have operated as separate listed companies even though IHCL has been a major shareholder and has played a role in its strategy. After the merger, Oriental Hotels’ assets and financials will move directly into IHCL, while some of Oriental's holdings in other companies in the IHCL group will also move up the ownership