UK and Gulf investors offer $1.3bn for Sahara's London and New York hotels: report
27 July 2016
A consortium of investors based in the Middle East and the UK has launched a $1.3 bn bid to acquire three hotels owned by jailed Indian businessman Subrata Roy, including the Grosvenor House Hotel on London's Park Lane and the Park Plaza and Dream Downtown hotels in New York.
The consortium of family office investors, comprising Jesdev Saggar-led 3 Associates of the UK and others from the Middle East, submitted bids to acquire Sahara group's majority stake in the three marquee hotel properties early today.
Reports have earlier pointed to the Qatar Investment Authority offering to buy the debt-laden hotels and this could spark a bidding war for the famed hotel properties.
Reports quoting officials of 3 Associates said they have made a "very compelling offer" and it was a long-term investment opportunity for them. "This is a long-term investment opportunity for us. We have submitted a very compelling offer. It is now up to the Supreme Court and the Roy family," they added.
Sahara bought the Grosvenor House Hotel in 2010 from the Royal Bank of Scotland for £470m. RBS took control of Grosvenor House in 2003 when Le Meridien, the previous hotel operator, fell into administration.
Sahara also owns a stake in New York's Plaza Hotel and Dream Downtown Hotel, which would be included in a potential deal.
The new all-equity bid has been submitted by UK-based family office 3 Associates, with cash provided by a family office based in the United Arab Emirates, through agency Knight Frank.
Reports that 3 Associates and its Middle Eastern backer were lining up a bid emerged last month, but the funds accelerated the process to take advantage of the weakened pound following the UK's vote to leave the European Union.
Jesdev Saggar, managing director of 3 Associates, said, "Because of the currency fluctuation we felt this was the right time to move on these assets.
"With all the uncertainty in the commercial property market since the vote, it's important that we don't lose sight of opportunities in London with regard to where the dollar is. Evidently we have selfish reasons for owning these assets, but it's important that the market understands that there is a tremendous amount of confidence in the London market."
A sale of the hotels would provide a lifeline to Roy, who was jailed in 2014 for refusing to follow court orders in a case filed by market regulator Sebi over an illegal bond scheme.
Roy has been out of prison on parole since May, but risks going back to jail next month unless he pays a Rs10,000-cr ($1.5bn) bail fee.
He had previously been allowed to seek buyers for the hotels from prison during a six-hour window each day.
Saggar said today's bid would be discussed as part of Roy's ongoing court case.