BAT PLC disclosed on Tuesday that it intends to use a block trade to sell institutional investors up to a 3.5 percent interest in India’s ITC Ltd.
Subject to customary closing circumstances, BAT intends to sell up to 43,68,51,457 common shares in ITC Ltd (ITC) through its wholly-owned subsidiary, Tobacco Manufacturers (India) Ltd (TMI), through an expedited bookbuild process (block trading).
Moreover, the ITC statement added that BAT will continue to own a significant ownership interest in ITC, with a 25.5% ownership holding, following the conclusion of the planned block trade.
The business intends to use the net proceeds from the block deal to repurchase BAT shares through December 2025, according to the announcement. The process is scheduled to start in 2024 with £700 million.
“I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders. We look forward to remaining important shareholders in ITC as it continues its journey of growth,” BAT Chief Executive Tadeu Marroco stated.
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Marroco continued, “With this transaction BAT can accelerate the start of a sustainable buyback, while enabling us to continue to deleverage towards a new target range of 2-2.5x adjusted net debt/adjusted EBITDA.”
“ITC is a valued associate of BAT in an attractive market with long-term growth potential where BAT benefits from exposure to the world’s most populous market,” the company added.
