Rothmans wants to retain stake in ITC

NEW DELHI, Dec 23: The UK-based Rothmans of Pall Mall believes that its two per cent stake in ITC should not call for a board resolution for setting up a 100 per cent owned subsidiary. "This equity shareholding in ITC was not an issue with Foreign Investment Promotion Board (FIPB) in granting us a 50:50 joint venture approval with GTC nor indeed was it an issue for a previous licence agreement with Godfrey Philips (India)," Rothmans director (public affairs) Bob Fletcher said.

Fletcher added that Rothmans’ minor stake in ITC, which was made in 1934, is distinctly different from that of any sizable strategic interest in a company. Rothmans has never sought to use its share to influence the management decisions of the company nor could it possibly hope to do so. "In simple terms, Rothmans receives its dividend on this longstanding investment in the same way that any other public shareholder would do," Fletcher stated. "We have every confidence that the FIPB will recognise this in considering Rothmans’ recent application to establish a 100 per cent subsidiary. The proposal merits an independent judgment from the FIPB which has been championing the cause of attracting sound direct foreign investments into various sectors of the fast growing Indian economy," he said. The company has stressed that it has credible corporate plans for India.