Mahindra Holidays to hike stake in Finland company

Stake in Oy raised to about 88%

The board of Mahindra Holidays & Resorts India (MHRIL), the country’s leading leisure hospitality provider, on Tuesday approved the proposal to increase its stake in Finland-based Holiday Club Resorts Oy, to 88 per cent.

Last year, MHRIL had picked up 19 per cent in the European company, which has 30 resorts in Finland, Sweden and Spain, through its wholly-owned subsidiary Covington Sarl, Luxembourg. The Mumbai-based company gradually raised its stake to 23.3 per cent.

With the exercise of the call option, the shareholding of MHRIL in Holiday Club Resorts can go up to 88 per cent, a statement said. The remaining 12 per cent are primarily held by the management. “The investment required for this 64.7 per cent stake is euro 28 million (Rs 202 crore)

The deal is expected to be completed in two or three months, subject to customary regulatory approvals in different countries. In addition to the above investments, MHRIL might also invest an additional euro 10 million (Rs 72 crore) in Holiday Club in the form of equity, loan, or in any other manner, to finance the growth of the company in the near future.

Arun Nanda, chairman of Mahindra Holidays and Resorts, said: “Our experience of working with the local management of Holiday Club over the past year has given us the conviction that it is the right partner for our growth strategy in Europe and West Asia. With this, MHRIL together with Holiday Club will become the world’s largest vacation ownership company based outside the US.”