The Sahara
Group may lose its hold on the iconic Grosvenor House hotel in London. Its Iargest
creditor, Bank of China, has put the property up for sale to recover its dues.
Sahara had
planned to sell or refinance its three offshore properties to realise
sufficient amount to enable the release of its jailed chairman, Subrata Roy.
The company
has reportedly taken a $900-million (`5,580 crore) loan from Bank of China to
buy the London hotel, as well as The
Plaza and Dream Downtown in New York.
The
Telegraph of London on Tuesday reported that Deloitte has been appointed as
administrator for the Grosvenor House sale. “We are in the process of agreeing
on a sale strategy,” a Deloitte executive said.
There is no
word yet on The Plaza and Dream Downtown.
Sahara
confirmed that an administrator had been named, but claimed it could continue
to explore refinance options, its preferred deal, with the administrator’s
approval.
“The loan on
Sahara’s three hotels from Bank of China is cross-collateralised and
cross-guaranteed,” it said in a statement.
“The debt
servicing for the UK and US loans has always been completely proper and timely.
However there has been technical breaches of the financial covenants in the
loans on the US hotels because of which Bank of China has declared an event of
default on the US loans. But because of cross collateralisation, the loan on Grosvenor House also is being
treated under default,” the statement added.
After
refinancing is obtained, the administrator would return control of the property
back to Sahara, it said.
