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India's Sahara denies it is bidding for Grosvenor House
May 28, 2015 / 4:22 PM / 3 years ago

India's Sahara denies it is bidding for Grosvenor House

MUMBAI (Reuters) - Troubled Indian conglomerate Sahara, the founder of which has been held in a jail for more than a year, has dismissed media reports saying it is participating in an auction of the Grosvenor House hotel in London as “incorrect and speculative”.

The Sahara group chairman Subrata Roy (C) arrives at the Supreme Court in New Delhi March 4, 2014. REUTERS/Anindito Mukherjee

Sahara bought the Grosvenor in 2010 but the hotel was placed in administration and put up for sale in March after Bank of China’s loan on the 494-room property, operated by Marriott International (MAR.O), was declared in default.

Indian media this week cited unnamed sources as saying that Sahara, through one of its units, Aamby Valley City Mauritius, was bidding to buy back the hotel.

“We would hereby like to clarify that Sahara or any of its group companies is not participating in any such re-auctioning,” Sahara said in a statement on Thursday.

Sahara founder Subrata Roy was arrested in March last year after the company failed to comply with a court order to refund money it had raised from millions of small investors by selling them bonds later ruled to be illegal.

India’s capital markets regulator and the Supreme Court have estimated that Sahara owes as much as $7 billion to the bond investors, but Sahara says it has repaid 95 percent of the amount due.

    The court, which on May 14 deferred a decision on Sahara’s bid to obtain bail for Roy, has previously said that Sahara would need to make an initial payment of $1.6 billion to secure Roy’s release and pay the rest once he was out on bail.

    Sahara, which has assets ranging from a Formula One team to TV channels, had been in talks to refinance the Grosvenor and two other overseas hotels to raise money to bail Roy.

    Consultant Deloitte has been appointed administrator of Sahara Grosvenor House Hospitality Ltd, which owns the long leasehold title to the London hotel. Property consultant Jones Lang LaSalle (JLL) is advising on the sale.

    Reporting by Sumeet Chatterjee; Editing by Devidutta Tripathy and David Goodman

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