More reports on: M&A, Hotels

Grosvenor House property in UK sold, Sahara tells court

news
19 June 2017

The Sahara Group today told the Supreme Court that it has sold its stake in London's Grosvenor House Hotel to G H Equity, UK. Sahara counsel Kapil Sibal told the bench of Dipak Misra and Ranjan Gogoi that the sale has been completed and sought permission of the court to transfer funds from the deal to the Sahara-SEBI refund account.

The Supreme Court granted 10 more working days to Sahara chief Subrata Roy to deposit Rs710 crore with the Sahara-SEBI refund account.

The apex court, hearing a case involving Roy and the Securities and Exchange Board of India (Sebi) over a dispute of returning money to investors, also extended its interim order granting bail to the Sahara chief till 5 July.

The Sebi court was to frame charges in the case against Roy and his three group firms' directors - Ravishankar Dubey, Ashok Roy Choudhary and Vandana Bhargava.

Meanwhile, the official liquidator of the Bombay High Court informed the bench that the schedule and terms and conditions have been finalised for the auction of Aamby Valley under the guidance of retired judge B N Agarwal, who is supervising the refunds in the case and sought the court's approval for the same.

The bench took note of this and said it would be taken up in the next hearing.

During the course of hearing in the apex court, Subrata Roy-led Sahara group deposited another Rs17 crore but it still fall short of the required Rs709.82 crore.

Roy on 18 May didn't appear before the Sebi court after filing an exemption application on medical grounds. However, the special Sebi court rejected Roy's plea.

While Sibal did not disclose the exact amount of the consideration for Grosvenor House, he said about 75 million was being brought to India and suggested that the transaction also involved refinancing of funds connected to the group's interests in the Plaza and Dream Downtown Hotels in New York.

According to the court's order in April, Sahara was to deposit Rs1,500 crore by 15 June and a further Rs522 crore by 15 July.

A post-dated cheque for Rs1,500 crore given by the group was dishonoured. Following this, the group was able to arrange a remittance of Rs790.18 crore as of Monday. After Sibal cited technical difficulties as the buyer of the London properties insisted on remittance to the Sebi-Sahara account, the bench allowed the group 10 days for the remaining sum of Rs709.82 crore to be remitted.

Posting the matter to 5 July, Misra warned that the court would be "compelled to send the contemnors to custody" if the new deadline was not adhered to. "Pay and get out," he added.

Sebi informed the court that with Monday's payment, the group has remitted a total of Rs10,395 crore.

The matter pertains to two group entities, Sahara Housing Invest and Sahara India Real Estate, which had raised Rs24,029 crore from 29.6 million investors between 2009-2011 by issuing optionally fully convertible debentures. Sebi held these issues illegal and directed that the sum be refunded to investors.

In 2012, the apex court upheld the Sebi order and directed the group to return the amount raised with interest of 15 per cent.

The court is following a two-pronged strategy for recovery of dues. On one hand, it has set stiff deadline for payments by the group, even as it is preparing ground for an auction of Aamby Valley, the Sahara group-owned luxury hill township in Pune-Mumbai Highway, which is estimated to be worth over Rs 37,000 crore. 

The SC today also directed that a 87-acre property in Haridwar belonging to the group be e-auctioned by Sebi after the group sought permission to sell it for Rs109 crore, which was about 38 per cent less than the circle rates.





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