Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Politics / Policy/  Unable to sell foreign assets, Sahara tells Supreme Court
BackBack

Unable to sell foreign assets, Sahara tells Supreme Court

Sahara group has to raise `10,000 crore, half in cash and rest in bank guarantee in order to release Roy from jail

Sahara chief Subrata Roy. Photo: BloombergPremium
Sahara chief Subrata Roy. Photo: Bloomberg

New Delhi/Bengaluru: The Sahara group on Friday told the Supreme Court that it has been unable to finalize sales of its three overseas properties.

Lawyer S. Ganesh appearing for jailed Sahara chief Subrata Roy told the apex court that the Bank of China (BoC), which had “formidable" rights as a secured creditor for these three properties, had created a “serious problem" in the sale and had issued a default notice to the firm.

As a secured creditor, BoC would have a right to the proceeds of the sale of these properties.

However, Sahara had managed to find an entity that was willing to take over the loan from BoC and allow it to create another encumbrance on the properties to get a loan of $650 million.

It also sought the release of the title deed of its Aamby Valley property from market regulator Securities and Exchange Board of India (Sebi) since it had managed to arrange a bank guarantee of $400 million by creating a mortgage on the property.

Out of its nine domestic properties, it had entered into agreements to sell five. It had sold one in Ahmedabad in April. The 100-acre plot was sold to city-based HN Safal group for around 411 crore.

The estimated valuation of these nine plots would be around 4,500-5,000 crore, a person familiar with the development said on condition of anonymity.

Sahara was seeking the court’s permission to proceed with these deals. Sebi will give its opinion on these agreements on 2 December. Sahara said once the court grants its approval, the loan amounts will first be transferred by the lenders into an escrow account and then into a Sebi-Sahara refund account.

A bench of justices T.S. Thakur, Anil R. Dave and A.K. Sikri said “no effort" is being made to sell the properties. The bench also questioned Sahara about a recent income tax department raid which had found over 140 crore in its offices.

Sahara said it had given a detailed explanation to the concerned authorities and this money was to be used to pay salaries.

The firm has been in talks for all its land assets with developers and wealthy individuals, said another person familiar with the development, who didn’t want to be named. “They had also signed term sheets for some of these parcels over the few months, but these kinds of transactions take time owing to due diligence, land title issues, etc.," he said.

Sahara has said it has signed sale agreements for its land in Chomma, Jodhpur, Vasai and Pune. One of its largest plots of land is in Chomma, near Gurgaon.

The 250-acre land is priced at 1,200 crore. The estimated valuation of these four plots of land will be around 3,300 crore, said the person familiar with the development.

Negotiations have also been on for three global properties owned by the Sahara group—Grosvenor House in London, the more than a century old Plaza Hotel overlooking New York’s Central Park, and Dream Downtown Hotel in the same city.

The Sahara group has to raise 10,000 crore, half in cash and the rest in bank guarantee in order to release Roy from jail. Out of this, Sahara has already deposited 3,117 crore.

Roy was sent to jail on 4 March, after he failed to appear in court in the contempt proceedings that the market regulator had initiated against two Sahara firms—Sahara India Real Estate Corp. Ltd and Sahara Housing Investment Corp. Ltd.

Sebi had proceeded against the group for failing to heed a court directive to refund investors a sum of around 20,000 crore from whom the two Sahara firms had raised the money through schemes that the regulator ruled were illegal.

Sahara has filed a defamation case in a Patna court against Mint’s editor and some reporters over the newspaper’s coverage of the company’s dispute with Sebi. Mint is contesting the case.

Shreeja Sen contributed to this story.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Politics News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Published: 29 Nov 2014, 12:06 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App