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Updated: March 12, 2014 22:01 IST

Sahara gets unsolicited offers for prized hotel assets

PTI
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Chairman of Sahara India Group Subrata Roy, arrives to appear before the Supreme Court in New Delhi on March 04 2014. A fiel photo: Shiv Kumar Pushpakar.
THE HINDU
Chairman of Sahara India Group Subrata Roy, arrives to appear before the Supreme Court in New Delhi on March 04 2014. A fiel photo: Shiv Kumar Pushpakar.

Embroiled in a major crisis back home, Indian conglomerate Sahara has got unsolicited offers for at least three prized assets — London’s Grosvenor House and New York’s Plaza and Dreams Downtown hotels.

While the group was open to sale of these properties if some really good offer came its way, the existing offers had been dismissed outrightly as they appeared to be made with a view to cashing in on the group’s current crisis, sources said.

When contacted, a senior Sahara official in India also confirmed that some ‘unsolicited’ offers had been received for overseas hotel properties, but the group had made it clear to them that these assets were not for sale.

While refusing to disclose the size of these offers and the identity of the parties interested, the official said that the group did not want to sell these assets as of now and it would consider any such move only if it got ‘extraordinarily’ high bids for these iconic assets.

The sources said, however, that some of these offers were in fact at discount to the price at which Sahara had actually purchased these assets and value the group’s holding in all three properties at $1-1.5 billion (Rs.6,000-10,000 crore).

While the exact identity of the interested parties could not be ascertained, investment bankers and consultants claiming to be exploring a deal said that their clients included entities from the Middle East and India, as also some Indian-origin foreign nationals. They were also pitching these properties before investors in the U.S. and the U.K. itself.

The three hotels had been purchased by the group over the past few years for about $1.5 billion, although all of them are managed by third party hotel management companies. The group claims to have a net worth of over Rs.68,000 crore and total assets worth over Rs.1.50 lakh crore. The acquisitions were funded by loans from various banks, while Bank of China got a significant exposure after it refinanced loans from some other banks, including HSBC, for some of these properties.

There have been speculations that Bank of China is also concerned about its exposure in the wake of ongoing controversy that the Sahara group has got embroiled into, but officials at the group vehemently denied any apprehensions on the part of the bank or that of other business partners.

In Plaza hotel, the Sahara group holds 75 per cent stake, while the remaining 25 per cent is with Kingdom Holding Company, an investment vehicle of Saudi Prince Alwaleed bin Talal.

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