The Investment Committee of the Board of Directors of Mahindra Holidays & Resorts India Limited (MHRIL), India's major leisure hospitality provider, on Tuesday approved the exercise of its option to increase its stake in Holiday Club Resorts, Oy, Finland (HCR) up to ~88%.
Holiday Club Resorts Oy, Finland, is one of the leading vacation ownership companies in Europe, with 30 resorts in Finland, Sweden and Spain.
"With the increase of stake in Holiday Club, we see a huge potential for synergy between the two market leaders in the areas of technology, new products, and member services. This acquisition will further strengthen Club Mahindra's proposition of providing leisure family holidays at unique destinations. Our 1.83 lac members will now have an added choice to visit HCR's resorts in Europe, alongside our existing 45 resorts in India and abroad," said Kavinder Singh, Managing Director and CEO, Mahindra Holidays.
The Company presently owns 23.3 percent of HCR and with the exercise of the call option, the shareholding of MHRIL in HCR can go up to 88%. The balance 12 percent is primarily held by the Management.
"I believe that the coming together of the two local market leaders will provide significant synergies. Our management is excited about all the opportunities that will come along with the deeper cooperation with Mahindra Holidays," said Vesa Tengman, Chief Executive Officer, Holiday Club Resorts Oy, Finland.
The investment required for this 64.7 percent stake is Euro 28 million. MHRIL would make this investment through its overseas subsidiaries. The deal is expected to be completed in a 2-3 month time-frame, subject to customary regulatory approvals in different countries.
In addition to the above investments MHRIL may invest an additional upto 10 million euros 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.
