Reliance Industries Raises Hold in East India Hotels

Reliance Industries, the biggest private sector company in India, which is controlled by billionaire Mukesh Ambani, said on Monday (August 30) that they purchased a 14.12% stake in East India Hotels (EIH), which operates the Trident and Oberoi brands. The transaction was a surprise to many industry experts and cost the company $217.5 million.

However, the day after that (Tuesday, August 31), Reliance increased their hold in EIH by 0.68% to 14.8%. The company had 1.15 million shares turned over on the National Stock Exchange in two block transactions. Shares in Reliance increased 0.3% to 939.3 rupees after the announcement of the deal was made, while EIH also saw shares rise 4.5% to 150.2 rupees.

Meanwhile, rumors were started on Thursday that Reliance has plans to buy a stake in Suzlon Energy, which is the largest maker of wind turbines in the country. This was started with a report from Zee Business channel, who didn’t say where they got the information.

Now Manoj Warrier, a spokesman for Reliance, has denied the claim, saying that they aren’t planning to buy a stake in Suzlon. Although, this wouldn’t have been very surprising, because they have been acquiring companies lately to diversify from the gas and oil industry. Nicholas Archer, the head of group public relations for Suzlon, said that they don’t comment on market rumors or speculations.

As for Suzlon, the company saw a 14% surge in shares due to the false claim and closed with 51.3 rupees per share with a 10% gain, which is the largest rise it has seen in almost a year. Also due to the claim, shares in Reliance rose 0.1% to 937.45 rupees.