EIH stock up 6% on more RIL role in co

EIH Ltd's stock rose after it was reported that the company is open to Reliance Industries (RIL)...

EIH Ltd’s stock rose more than 6 percent in late afternoon deals after it was reported that the company is open to Reliance Industries (RIL),which holds 14.8 percent equity,picking up more stake,and could offer it a seat on the board,four dealers said.

The channel also reported that EIH may form a joint venture with Reliance for the hotel and real estate business,dealers added. An EIH spokeswoman declined immediate comment.

Reliance came as a ‘white knight’ and a board seat to them looks sensible and positive to Oberois (EIH promoters),said an investment banker who has worked closely with Reliance and EIH in the past.

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The term ‘white knight’ is used to describe a friendly investor who is brought in to ward off a hostile takeover attempt. According to recent media reports,the chairman of ITC,another large minority shareholder in EIH told its shareholders at the annual general meeting that ITC was open to increasing stake in EIH,raising concerns of a hostile takeover.

At 3.29 p.m.,shares of EIH were up 1.42 percent at 86 rupees.

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