BAT PLC has announced that its subsidiary Tobacco Manufacturers (India) Limited plans to sell up to 436,85 million shares of ITC Limited.

BAT PLC has announced that its wholly-owned subsidiary Tobacco Manufacturers (India) Limited (“TMI”) intends to sell up to 436,851,457 ordinary shares (the “Block Trade Shares”) in ITC Limited (“ITC”) to institutional investors by way of an accelerated bookbuild process (the “Block Trade”), subject to customary closing conditions. The Block Trade Shares represent up to c.3.5 per cent of ITC’s issued ordinary share capital.
“ITC is a valued associate of BAT in an attractive market with long-term growth potential where BAT benefits from exposure to the world’s most populous market,” Bat said in a statement. BAT’s initial investment in ITC dates back to the early 1900s and the two companies have a longstanding, mutually beneficial relationship.
“As one of India’s leading FMCG enterprises, ITC has delivered significant value for its shareholders and BAT continues to be fully supportive of ITC’s management team, performance and strategy. Following completion of the proposed Block Trade, BAT will remain a significant shareholder of ITC, with a c.25.5 per cent holding.”
BAT intends to use the net proceeds of the Block Trade to buy back BAT shares over a period ending December 2025, starting with GBP 700 million in 2024. BAT will continue to allocate operating cashflow to fund investment in its transformation and to further deleverage.
Going forward the key elements of capital allocation at BAT will include:
• Continued investment in our transformation
• Progressive dividends
• Continued deleverage to a new range of 2-2.5x adjusted net debt / adjusted EBITDA.
• Sustainable share buybacks
Tadeu Marroco, Chief Executive of BAT said: “I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders. We look forward to remaining important shareholders in ITC as it continues its journey of growth. With this transaction BAT can accelerate the start of a sustainable buyback, while enabling us to continue to deleverage towards a new target range of 2-2.5x adjusted net debt / adjusted EBITDA.”