EIH gets board nod for Rs 1,300-cr rights issue

East India Hotels Ltd (EIH), the operator of the Oberoi luxury hotel chain, on Thursday said it will raise up to Rs 1,300 crore through the issue of shares on a rights basis.

The company has received approval from its board for raising the funds, EIH said in a statement.

"The board at today's (Thursday) meeting accorded consent to a rights issue of equity shares, not exceeding Rs 1,300 crore," it said.

However, the purpose for which the funds would be utilised could not be ascertained immediately.

The company's board has formed a committee to finalise the ratio, issue price and all procedural modalities relating to the rights issue.

Mukesh Ambani-led Reliance Industries had last month acquired a 14.8 per cent stake in EIH.

According to industry experts, RIL's move was aimed at keeping rival ITC from making an open offer to increase its stake in the company.

EIH's shares closed at Rs 139.85 on Thursday, down 0.25 per cent from the previous close on the Bombay Stock Exchange.

EIH operates hotels and resorts across India under the Oberoi and Trident brands.