​Sahara lacks money to get Subrata bail, but can bid for London’s Grosvenor House hotel! Ridiculous, did we hear anyone say

Sahara chief Subrata Roy might be in jail and surviving the heatwaves of May, but his ambition seems to be kissing the sky.

The debt ridden Sahara Group, which failed to produce a Rs 10,000 crore bond to release it’s supremo is bidding for London's iconic Grosvenor House hotel. As per a news report in The Economic Times Sahara had bought the property in 2010 and lost control after defaulting on a loan, marking a bizarre twist in a long-running saga in which the group's founder has spent more than a year behind bars.


Sources have informed the ET, Sahara Group, via its subsidiary Amby Valley Mauritius, has emerged as one of the bidders. Other bidders are Constellation Hotels Holding, M&G Prudential, Abu Dhabi Investment Authority and China's Fosun Group.

The sources have also confirmed that the bids received so far are in the range of £600-625 million (up to nearly Rs 6,150 crore. The Bank of China (BOC), which has custody of the hotel, has appointed Deloitte as the administrator for the property and Jones Lang LaSalle (JLL) as one of the sales agents.

In 2010, the BOC had financed the Sahara group for purchasing the Grosvenor House hotel along with two hotels in New York - Dream Downtown and The Plaza. Earlier this year, Sahara defaulted on BOC's loan of close to $800 million, after which the London hotel came under its custody.

When Sahara ran into trouble with India's capital markets regulator, Securities and Exchange Board of India (Sebi), the BOC asked the group to pay back its debt. Between 2013 and 2014, the group had received several bids for all the three hotel properties from possible investors, including royal families in the Middle-East. The bidders had offered close to £900 million for the London hotel alone. But the Sahara Group did not accept any offer and finally defaulted on the BOC loan.


An email sent to Sahara by the financial daily did not elicit any response. JLL said it did not have any comments to offer at this time. A legal expert involved with the current transaction said that though Sahara has emerged as one of the bidders for the property, BOC officials are still trying to figure out whether the authorities in India could create any legal problems if Sahara were to be awarded the deal.

Sahara's ability to raise money for the deal is also being doubted, according to people involved in the negotiations, especially since the group is relying on backing by other financiers.

Subrata Roy, founder and head of Sahara group, is currently in Tihar Jail, from where he unsuccessfully tried to negotiate a deal to sell the hotels.

(Image : Reuters)