daniel chigunwe
British American Tobacco Plc’s shares rose the most in nearly four years after it said it was trying to overcome regulatory hurdles to sell at least part of its stake in Indian company ITC, valued at more than £14 billion (US$17,7 billion).
BAT has “been actively working for some time on completing the regulatory process required to give us the flexibility to monetise some of our shareholding,” it said in full-year results, released on Thursday.
ITC is India’s biggest cigarette maker but the company has diversified into other businesses including luxury hotels. BAT owns a 29 percent stake.
Chief executive officer Tadeu Marroco told analysts the potential stake sale in ITC comes as BAT looks for better balance sheet flexibility.
It has owned a stake in ITC for over 100 years and the shareholding has been subjected to numerous regulatory restrictions, he added.
Owen Bennett, an analyst at Jefferies, said it was the “strongest signal yet” around the potential stake sale.
“This would be a big positive,” said. — Bloomberg
Bongani Ndlovu