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India's Poor Little Rich Man, Sahara, Struggling To Get Out Of Jail

This article is more than 9 years old.

The jailed chief of India’s Sahara Group, Subrata Roy Sahara, a multi-billionaire by some measures, is laboring to cobble together the funds needed to bail himself out of the infamous Tihar Jail in New Delhi. India’s Supreme Court said it had run out of patience with the group’s repeated but unmet assurances on raising the cash. Last week, the Court gave the group a last chance to raise the $1.6 billion bail amount, even as the beleaguered Sahara’s lawyers pleaded for more time to sell the group’s marquee properties to raise cash.

The showy Sahara, 66, whose rumored net worth of over $10 billion is mostly locked up in illiquid property assets within India and overseas, has been behind bars since March 2014 after he was charged with contempt of court following failure to appear and comply with the market regulator’s directive that he repay thousands of poor who invested in a bond scheme floated by his group. (The scheme has been termed illegal subsequently). The Supreme Court's set a stiff amount $1.6 billion, the largest ever bail ever set in India, after the regulator estimated that the businessman had to repay investors an estimated over $4 billion of deposits and interest. The group is contesting the estimate.

The Court said if the group failed this last chance, it would direct the auction of the group properties to raise the money to repay investors.

It has been a great tumble for Subrata Roy Sahara, the showy chairman of the Sahara group, whose interests cover hotels, real estate and media, besides financial services.

Last year, to aid the search for buyers, the Supreme Court had allowed the group to work out of a makeshift high-tech office set up within the jail premises. But a sale has not worked out as months have ticked by. A loan deal with U.S.-based Mirach Capital Group against Sahara’s plush properties including New York’s Plaza Hotel and London’s Grosvenor House Hotel, was mired in controversy last month after a letter detailing the proposed deal was alleged to be forged. Meanwhile news is that Sahara has defaulted on loan agreements with the Bank of China which were procured against luxury hotel properties. Bloomberg reported that Deloitte LLP has been appointed administrator to sell the Sahara-owned Grosvenor House in London.

Subrata Roy Sahara, in white. (Image: Sahara Group)