Scheme of Arrangement
LEMONTREE · price
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Awaiting price reaction for this filing.
Lemon Tree Hotels' board approved a composite scheme to split the group into two focused entities: LTHL as the asset-light hotel management and brand platform, and Fleur Hotels (FHL) as the asset-heavy hotel ownership and development platform. Two wholly-owned subsidiaries will merge into LTHL and four others will merge into FHL, while 11 operating hotels and 1 under-construction hotel (turnover of Rs. 23,037 lakhs, about 59.9% of LTHL's revenue) will be demerged into FHL. As consideration for the demerger, LTHL shareholders will get 20 FHL shares for every 311 LTHL shares, and FHL will be separately listed. International investor Coastal Cedar Investments B.V. is acquiring APG's 41.09% stake in FHL and has committed up to Rs. 960 crore in growth capital through a preferential issue, with LTHL retaining a ~41% stake in FHL post-scheme.
Shareholders will end up holding shares in two listed entities, potentially unlocking separate valuations for the management business and the asset-heavy hotel portfolio. Near-term, the stock may see volatility as the scheme still needs NCLT, SEBI, CCI and shareholder/creditor approvals before becoming effective from the appointed date of April 1, 2026.