ITC Ltd, has claimed «oppression» at the hands of the promoters of Hotel Leelaventure Limited (HLV) which runs hotels in India under the Leela brand. ITC says being a minority shareholder its interests are being ignored by HLV. The battle between the two has been raging for the last five years and, of course, HLV has contested claims made by ITC which holds a 7.92% stake in HLV.
Since 2008, ITC has been buying shares of HLV from the open market through Russell Credit, its investment arm. In March 2017, after part of HLV's debt was converted into equity, ITC’s shareholding in the hotels chain had dropped from 11.8% to the current level of 7.92%. At that time, JM Financial ARC had converted Rs 275 crore debt into 26% equity in Hotel Leela.
How it all began In January 2019, debt-laden HLV Limited went into insolvency under the Insolvency and Bankruptcy Code (IBC). HLV had announced in March 2019 that the company's hotel business together with all the assets and liabilities of hotels located in Bengaluru, Chennai, Delhi and Udaipur were being acquired by Brookfield on a slump sale basis for ?3,950 crore.
The company had said besides the four assets, the transaction included the transfer and assignment of all the company's contracts for the operation and management of hotels and the provision of amenity services in serviced apartments, as well as 100% shareholding in subsidiary Leela Palaces and Resorts, which owns the property and licence for the development of a hotel in Agra.
In April 2019, ITC moved Sebi against