Sahara India close to sealing $575 million New York's Plaza Hotel deal
12 June 2012
Diversified business group Sahara India, whose businesses range from airlines, luxury resorts to media and finance, is close to finalising a $575 million (Rs3,200 crore) deal for a majority stake in New York's The Plaza from Israeli entrepreneur Isaac Tshuva's Elad Properties.
Under the deal that is likely to be announced later this month, Sahara's offer is divided into two parts, $400 million for the hotel portion of the Plaza, which has 230 rooms, and the remaining $200 million for the retail portion of the hotel, which encompasses the hotel's banquet hall, restaurants, fitness centre and other common areas wholly owned by El Ad.
Saudi Prince Alwaleed Bin Talal's Kingdom Holdings owns 50 per cent of an entity that holds 130 of the Plaza's rooms and 25 per cent of another entity that holds 100 rooms that were resold as condos and are rented out as hotel rooms. Elad owns the rest.
Fairmont Hotels & Resorts, in which Kingdom has a stake, will continue to operate the Plaza for at least two years, before handing over control to Sahara.
The Times of India today reported that Sahara India has raised £250 million by pledging the Grosvenor House Hotel in London to part-finance the Plaza acquisition.
In 2010, Sahara had acquired the historic Grosvenor House Hotel that was once home to the Duke of Westminster and frequented by royalty, celebrities and business leaders, for throwaway price of £470 million or Rs3,275 crore. (See: Sahara India Pariwar buys London's Grosvenor House Hotel for Rs3,275 crore)
The Plaza Hotel, located at fifth Avenue and Central Park South, opened its doors on 1 October 1907 and is considered as one of America's most celebrated hotels.
Kings, presidents, ambassadors, movie and sports stars, as well as business executives and travellers from all parts of the world have stayed at The Plaza.