British American Tobacco sells 2.5 pc stake in ITC for Rs 12,941 crore

New Delhi, May 28 (PTI) British multinational BAT Plc on Wednesday trimmed its shareholding in conglomerate ITC by divesting a 2.5 per cent stake for Rs 12,941 crore through open market transactions.

After the stake sale, BAT’s shareholding has dropped to 22.94 per cent in FMCG major ITC from 25.44 per cent earlier. The British firm, however, still remains a significant shareholder of ITC.

According to the bulk deal data available with the NSE, Tobacco Manufacturers (India) Ltd, an arm of British American Tobacco (BAT), offloaded a total of 31.30 crore equity shares, representing a 2.5 per cent stake in ITC.

The shares were sold in the price range of Rs 413.12 per share to Rs 413.78 apiece. The total transaction value was Rs 12,940.98 crore.

After the stake sale, Tobacco Manufacturers (India) Ltd's stake in ITC declined to 17.81 per cent from 20.31 per cent earlier.

BAT through its affiliates -- Rothmans International Enterprises, Myddleton Investment Company and Tobacco Manufacturers (India) Ltd -- owned a combined 25.44 per cent stake in ITC Ltd at the end of the March quarter.

Details of the buyers of ITC's shares could not be ascertained on the National Stock Exchange (NSE).

ITC shares fell 1.19 per cent to close at Rs 421 per piece on the NSE.

In a regulatory filing on the London Stock Exchange, British American Tobacco (Group) on Wednesday said it has completed the block trade of 31.30 crore ordinary shares in ITC Ltd to institutional investors by way of an accelerated book build process.

The block trade shares represent 2.5 per cent of ITC's issued ordinary share capital. The net proceeds from the block trade amount to Rs 12,100 crore, it said.

BAT said that the transaction will provide the group greater financial flexibility as it delivers on its commitment to invest behind transformation, deleverage and enhance shareholder returns.

The net proceeds from the trade will also be utilised to extend the Group's existing share buyback programme announced on March 18, 2024, by an additional 200 million pounds, taking the total amount to be repurchased in 2025 to 1.1 billion pounds, it added.

"The extension will begin following completion of the latest tranche of the programme announced on 29 April 2025 and is expected to complete no later than 31 December 2025," BAT said.

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.

"ITC is a valued associate of BAT in an attractive geography with long-term growth potential where BAT benefits from exposure to the world's most populous market.

"Whilst this transaction supports delivery on our commitments to BAT shareholders, we continue to view ITC as a core strategic component of our global footprint as we partner on business opportunities in India. I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders," BAT's Chief Executive Tadeu Marroco said.

In March 2024, BAT Plc sold a 3.5 per cent stake in ITC Ltd for Rs 17,485 crore.

BAT is in the 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. PTI HG MR