New York: In a major relief, Sahara Group has got time till June to avoid any foreclosure auction of its two marquee hotel properties here by mortgage holders Reuben Brothers, who had extended a USD 900 million loan refinance facility to the embattled Indian group.
The billionaire investors David and Simon Reuben were reportedly earlier looking at a foreclosure auction in April to recover their facility which they had provided to Sahara Group to refinance an earlier loan from Bank of China that had overseas hotels of the Indian group as collaterals and cross collaterals.
Sources said Sahara has now been given time till June by Reuben Brothers. When contacted, a Sahara spokesperson confirmed the development but did not elaborate.
Query sent to Reuben Brothers did not elicit any immediate response. Reportedly, the foreclosure auction of iconic Plaza and trendy Dream Downtown properties was to take place in April.
Sahara Group has been making efforts to raise funds including through refinancing of loans on these two hotels as also on the historic Grosvenor House property in London, to ensure release of its chief Subrata Roy from jail.
He has been lodged in New Delhi's Tihar Jail for over two years.In March 2015, Bank of China had put Grosvenor House under "administration" for recovery of its loans after the lender declared "an event of default" on the US loans due to some technical breaches in the financial covenants.The loan on Sahara's three hotels -- Grosvenor House in the UK and the two prime hotels in New York -- from Bank of China was "cross collateralised and cross guaranteed".
Subsequently, Sahara reached a USD 900 million (over Rs5,500 crore) refinancing deal with Reuben brothers and averted the 'default-triggered' sale of Grosvenor House hotel property.
Grosvenor House, a landmark property on Park Lane in London that was designed by acclaimed architect Sir Edwin Lutyens, was purchased by Saharas in 2010. The two hotels in the US were purchased later. The three hotels were acquired between 2010-2012 at an estimated valuation of USD 1.55 billion.
Market experts peg their current valuation at upwards of USD 2.2 billion. Sahara group has been engaged in a legal battle with markets regulator Sebi for a long time over a case involving raising of funds from investors to the tune of over Rs 24,000 crore.
Sahara, however, claims it has already repaid 95 per cent of the investors' money directly. Last month, a Sahara spokesperson had said that Sebi so far has been able to refund around Rs 50 crore to the investors.
