British American Tobacco sells 3.5 per cent stake in ITC for Rs 17,485 crore

BAT sold more than 43.68 crore equity shares in 48 tranches


British multinational BAT Plc, on Wednesday, sold 3.5 per cent stake in ITC Ltd for Rs 17,485 crore through open market transactions.

Even after completion of the block trade, BAT will remain a significant shareholder of ITC, with 25.5 per cent holding in FMCG-to-hotel conglomerate ITC.

Singapore government, Monetary Authority of Singapore, Lockheed Martin Corporation, Goldman Sachs (Singapore), Copthall Mauritius Investment, BofA Securities Europe SA, Societe Generale, Morgan Stanley Asia Singapore Pte, and Ghisallo Master Fund LP picked up shares in ITC.

BAT sold more than 43.68 crore equity shares in 48 tranches, amounting to a 3.5 per cent stake, through its affiliate Tobacco Manufacturers (India) Ltd.

The shares were disposed of at an average price of Rs 400.25 apiece, taking the deal size to Rs 17,484.97 crore, according to the block deal data available with the BSE.

As of December 2023, BAT through its affiliates—Tobacco Manufacturers (India) Ltd, Myddleton Investment Company Ltd, and Rothmans International Enterprises Ltd—owned a 29.03 per cent stake in ITC.

ICICI Prudential Mutual Fund (MF), Motilal Oswal MF, Nippon India MF, SBI MF, Max Life Insurance Company, IMF, Capital Group, Kuwait Investment Authority, The People's Bank of China, International Bank for Reconstruction and Development were among the buyers of the shares.

The scrip of ITC ended the day with a gain of 4.49 per cent at Rs 422.40 apiece while the BSE benchmark closed in the red.

On Tuesday, BAT said it plans to sell up to 3.5 per cent stake in India's ITC Ltd to institutional investors through a block trade.

The company had said it intends to use the net proceeds of the block trade to buy back BAT shares through December 2025, starting with 700 million pound in 2024.

Further, it will also continue to allocate operating cashflow to fund investment in its transformation and to further deleverage.

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 and BAT continues to be fully supportive of ITC's management team, performance and strategy, BAT said in a statement.

BAT is into 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.

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