The Hindu Business Line : Punjab Hotels to come under Taj GVK fold

TAJ GVK Hotels & Resorts Ltd, the city-based hospitality joint venture between the Tatas and GVK group, is planning to merge with itself Punjab Hotels Ltd (PHL), the five-star hotel based in Chandigarh recently acquired from the India Tourism Development Corporation (ITDC).

This assumes significance since Taj GVK, which has Taj Krishna, Taj Banjara and Taj Residency — all located in Banjara Hills here, and the Punjab Hotels at Chandigarh operating at three different price bands, would now add another, making it a multi-locational hospitality major.

According to a senior official of Taj GVK, the company has successfully completed the acquisition of Punjab Hotels from ITDC through disinvestment process and as a result of 100 per cent equity acquisition, PHL has become a wholly-owned subsidiary of the Tatas-GVK venture.

"We have decided to merge PHL with Taj GVK so that the combined entity would be able to carry on the business more economically and efficiently. "This would result in enlarging its activities and optimal utilisation of management and other resources. It would also help in the avoidance of duplication of unnecessary administrative expenses and other overheads, " he told Business Line.

Stating that there was no issue of any shares in consideration for the amalgamation, he said since PHL was a wholly owned subsidiary of Taj GVK, the shares currently held by it in PHL would get cancelled upon amalgamation.

According to him, PHL has already filed a company petition before the Delhi High Court for sanction of the amalgamation scheme, which was pending before the court. At present, PHL has a paid-up equity of Rs 4.66 crore and availed of unsecured loans of Rs 15.26 crore from the holding company.

Meanwhile, the Taj GVK board has decided to increase the maximum number of directors on the board to 16 from the existing limit of 12.

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