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The Print
3 days ago
- Business
- The Print
British American Tobacco sells 2.3 pc stake in ITC for Rs 11,613 crore
British American Tobacco (BAT), through its arm Tobacco Manufacturers (India) Ltd, sold the stake in Kolkata-based ITC. After the stake sale, shares of ITC slipped 1.46 per cent to trade at Rs 419.85 apiece on the NSE. New Delhi, May 28 (PTI) British multinational BAT Plc on Wednesday trimmed its stake in conglomerate ITC by 2.3 per cent through a block deal worth Rs 11,613 crore (USD 1.36 billion), according to the deal terms accessed by PTI. Before the latest transaction, BAT through its affiliates — Rothmans International Enterprises, Myddleton Investment Company and Tobacco Manufacturers (India) Ltd — owned a combined 25.44 per cent stake in ITC Ltd. As per the block deal, up to 29 crore equity shares of ITC were sold at a floor price of Rs 400 per share. This represents a discount of about 7.8 per cent to ITC's closing price of Rs 433.90 on the National Stock Exchange (NSE) on Tuesday, sources said. Goldman Sachs (India) Securities Pvt Ltd and Citigroup Global Markets India are the placement agents for the transaction, they added. The sources said 29 crore shares amount to around a 2.3 per cent stake in the company. At the offer floor price, the total size of the transaction is pegged at Rs 11,613 crore or (USD 1.36 billion). The shares sale executed through multiple tranches on the BSE and NSE under the bulk sale route. The share sale is entirely secondary in nature, meaning that ITC will not receive any proceeds from the deal, and the stake is being sold solely by the Tobacco Manufacturers (India) Ltd. The seller and its affiliates will be subject to a lock-up period of six months post-sale. In a regulatory filing on the London Stock Exchange, BAT plc on Tuesday announced that its wholly-owned subsidiary Tobacco Manufacturers (India) Ltd intends to sell 2.3 per cent of the issued ordinary share capital in ITC Ltd. The transaction will provide BAT with increased financial flexibility as it delivers on its commitment to invest in transformation, deleverage and sustainable shareholder returns. BAT's initial investment in ITC dates back to the early 1900s, and the two companies have a longstanding, mutually beneficial relationship. As one of India's leading FMCG enterprises, ITC has delivered significant value for its shareholders. Following completion of the block trade, BAT will remain a significant shareholder of ITC, with a 23.1 per cent holding in FMCG-to-hotel conglomerate ITC, it added. 'ITC is a valued associate of BAT in an attractive geography with long-term growth potential where BAT benefits from exposure to the world's most populous market. 'Whilst this transaction supports delivery on our commitments to BAT shareholders, we continue to view ITC as a core strategic component of our global footprint as we partner on business opportunities in India. I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders,' BAT's Chief Executive Tadeu Marroco said. In March 2024, British multinational BAT Plc on Wednesday sold a 3.5 per cent stake in ITC Ltd for Rs 17,485 crore. BAT is in the multi-category consumer goods business. Its strategic portfolio comprises global cigarette brands and a growing range of nicotine and smokeless tobacco products, including vapour brand Vuse; heated product brand 'glo' and Velo, a modern oral (nicotine pouch) brand. PTI HG DR This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
Time of India
3 days ago
- Business
- Time of India
British American Tobacco trims ITC stake by 2.5% in Rs 12,941 crore deal to boost financial flexibility
British American Tobacco Plc (BAT) on Wednesday divested a 2.5 per cent stake in Indian conglomerate ITC Ltd for Rs 12,941 crore through open market transactions, reducing its shareholding in the FMCG giant to 22.94 per cent from 25.44 per cent. According to bulk deal data available with the National Stock Exchange (NSE), BAT's affiliate Tobacco Manufacturers (India) Ltd sold 31.30 crore equity shares of ITC at a price between Rs 413.12 and Rs 413.78 per share, PTI reported. Following the transaction, Tobacco Manufacturers (India) Ltd's stake dropped to 17.81 per cent from 20.31 per cent. Overall, BAT holds a combined 22.94 per cent in ITC through its affiliates — Tobacco Manufacturers (India) Ltd, Rothmans International Enterprises, and Myddleton Investment Company — as of the end of the March quarter. The identity of the institutional buyers in the deal could not be immediately ascertained from NSE data. ITC shares closed 1.19 per cent lower at Rs 421 apiece on the NSE. In a filing to the London Stock Exchange, BAT confirmed it had completed the block trade of 31.30 crore ordinary shares of ITC through an accelerated book build process. The net proceeds from the trade amount to Rs 12,100 crore. BAT said the deal 'will provide the group greater financial flexibility as it delivers on its commitment to invest behind transformation, deleverage and enhance shareholder returns.' The company added that the proceeds will help extend its share buyback programme announced in March 2024 by an additional £200 million, taking the total buyback for 2025 to £1.1 billion. This extension will begin after the completion of the tranche announced on April 29, 2025, and is expected to be concluded by December 31, 2025. BAT's Chief Executive Tadeu Marroco said, 'Whilst this transaction supports delivery on our commitments to BAT shareholders, we continue to view ITC as a core strategic component of our global footprint as we partner on business opportunities in India. I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders.' He further noted, 'ITC is a valued associate of BAT in an attractive geography with long-term growth potential where BAT benefits from exposure to the world's most populous market.' BAT first invested in ITC in the early 1900s and has since built a longstanding relationship with the company, which remains one of India's top FMCG firms. In March 2024, BAT had offloaded a 3.5 per cent stake in ITC for Rs 17,485 crore. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
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Business Standard
3 days ago
- Business
- Business Standard
BAT pares stake in ITC to 22.9%, relinquishes veto power in key move
BAT's latest stake sale trims its ITC holding below 25 per cent, ending veto rights just a year after it cited the importance of maintaining control through board influence British American Tobacco plc (BAT) has sold a 2.5 per cent holding in ITC, ceding veto power in the cigarettes-to-soap conglomerate. In an intimation to the London Stock Exchange (LSE) on Wednesday, the maker of Dunhill and Lucky Strike stated that it had completed the block trade of 313,000,000 ordinary shares in ITC Limited to institutional investors via an accelerated bookbuild process. The shares represent 2.5 per cent of ITC, and net proceeds from the sale amounted to Rs 12,900 crore. With this sale, BAT's holding is expected to be around 22.9 per cent. On Tuesday, while announcing the stake sale, BAT had said it would remain a significant shareholder of ITC with a 23.1 per cent holding. A 25 per cent holding enables shareholders to influence or oppose resolutions, especially special resolutions that require 75 per cent of the votes cast to be in favour. An email sent to BAT received a response referring to the exchange filing, with the company stating, 'no further comments will be provided at this time.' However, in 2023, during a Deutsche Bank – Global Consumer Conference, Tadeu Marroco, chief executive of BAT, had outlined the importance of having 'at least 25 per cent of shareholding in India.' He had said that a 25 per cent stake would allow BAT to retain board seats, veto company resolutions, and steer towards certain opportunities. But BAT had sold 3.5 per cent in ITC in March 2024 to initiate its buyback programme. That sale, which reduced its stake to 25.45 per cent, generated net proceeds of £1.6 billion after transaction costs and taxes, and was used to begin the buyback. Later that year, during Capital Markets Day, Marroco said about ITC, 'We have to be mindful that there is a foreign direct investment (FDI) ban in India, which means that if you sell, you don't come back.' According to Abneesh Roy, executive director and head of the research committee at Nuvama Institutional Equities, a holding below 25 per cent means BAT can no longer block special resolutions. 'Till date, we remember only once BAT has blocked a special resolution on ESOP. So, not a material thing,' he said. It was in 2018 that BAT used its veto power to block a special resolution granting stock options to employees of ITC and its subsidiaries. The plan received 63.49 per cent of votes in favour, short of the requisite 75 per cent majority. While 98.77 per cent of institutions voted in favour, 89.22 per cent of non-institutional public shareholders (which included BAT) voted against it. BAT had said at the time that it had made its position clear since 2010—that it would not support proposals that diluted shareholder value. This led ITC to adopt a new scheme, the Stock Appreciation Rights Scheme (SARS), which resulted in minimal additions to share capital. Since then, BAT's position appears to have shifted significantly, with the UK-based company paring its stake in ITC for the second time in two years. The turn of events is especially ironic, given that in 1994 BAT had attempted to secure a majority stake to gain control of ITC. It's a long way since then—the British multinational is now focused on its commitment to invest in transformation, deleverage, and enhance shareholder returns.
Business Upturn
3 days ago
- Business
- Business Upturn
ITC Block Deal: BAT sells over 2.5% stake worth Rs 13,860 crore, stock falls 4%
Shares of ITC Ltd fell 3.5% to ₹418.70 on Tuesday after British American Tobacco (BAT), the company's largest shareholder, launched a substantial block deal to offload 2.57% stake in the FMCG major. The deal, which was earlier pegged at 2.3%, was upsized to 2.57%, representing 33.25 crore shares valued at ₹13,860 crore at ₹417 apiece. In a disclosure made to the London Stock Exchange, BAT said its wholly-owned subsidiary Tobacco Manufacturers (India) Limited intends to sell the shares via an accelerated book-building process. The sale is aimed at providing BAT with increased financial flexibility as it progresses on transformation, deleveraging, and enhancing shareholder returns. 'ITC is a valued associate of BAT in an attractive growth market. While this transaction supports delivery on our commitments to BAT shareholders, we continue to view ITC as a core strategic investment,' said Tadeu Marroco, Chief Executive of BAT, in an official statement released on May 27, 2025. The transaction will support BAT's goal of reaching a 2.5x adjusted net debt/adjusted EBITDA leverage corridor by the end of 2026 and fund a £200 million increase in its share buyback programme. Despite the sale, BAT will retain a significant holding of approximately 23.1% in ITC. The market reaction was swift, with ITC shares slipping as investors digested the overhang from the large secondary sale. BAT had initially invested in ITC over a century ago and has maintained a beneficial relationship with the Indian conglomerate, which remains one of the country's leading FMCG enterprises. Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Aditya Bhagchandani serves as the Senior Editor and Writer at Business Upturn, where he leads coverage across the Business, Finance, Corporate, and Stock Market segments. With a keen eye for detail and a commitment to journalistic integrity, he not only contributes insightful articles but also oversees editorial direction for the reporting team.
Economic Times
3 days ago
- Business
- Economic Times
ITC shares in focus as BAT likely to sell 2.3% stake via block deal
ITC shares: British American Tobacco (BAT) has announced its intention to sell approximately 2.3% of its stake in ITC. ITC shares: The London-listed tobacco giant, which currently owns a 25.4% stake in ITC, will continue to be the company's largest shareholder after the proposed sale, maintaining a 23.1% stake following the transaction. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Shares of ITC are likely to be in the spotlight on Wednesday, May 28, after British American Tobacco BAT ) announced plans to sell about 2.3% of its stake in the Indian consumer goods major through a block deal , according to a Reuters London-listed tobacco giant, which currently holds a 25.4% stake in ITC, will remain the company's largest shareholder even after the proposed sale, retaining a 23.1% holding deal is expected to be executed in the market hours. The company also said it will raise its 2025 share buyback programme by 200 million pounds to 1.3 billion pounds ($1.67 billion) following the stake BAT clarified that the transaction will not impact its annual financial development comes more than a year after BAT offloaded 436.9 million ITC shares—roughly 3.5% of the company's outstanding equity—for around Rs 16,690 crore, marking India's third-largest block trade on a notification to the London Stock Exchange, the UK-headquartered company said its wholly-owned subsidiary Tobacco Manufacturers (India) Ltd will sell its share in CEO Tadeu Marroco, in a release, described ITC as a valued partner in a high-potential market, emphasizing that BAT continues to benefit from its presence in the world's most populous read: HDFC unit is said to near SEBI nod for $1.5 billion IPO According to some media reports, the proposed block deal could be valued at approximately $1.36 billion, with ITC shares expected to be offered at around Rs 400 apiece. However, this information could not be verified by shares of ITC closed 2% lower at Rs 433.90 on the BSE on Tuesday.
