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Ambitious Sahara bought trophy assets around the world
Bagging trophy assets such as palaces in exotic European destinations and hotel portfolios are part of its strategy.
The Sahara group’s expansion into many areas of the services industry - retail, real estate and hospitality - reflects its huge ambitions.
While it has made some big announcements in the retail and real estate sectors, the group’s achievement in hospitality has been more real.
In 2012, when Sahara struck a deal to buy the Plaza, New York, for $570 million (around Rs 3,500 crore now), it showed to the world that it had arrived on the global hotel scene.
Just two years before that, in 2010, it had signed a $726-million deal to make London’s Grosvenor House its own.
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Ambitious Sahara bought trophy assets around the world
It was the acquisition of this hotel, built on the site of the former London residence of the Duke of Westminster in the prestigious Mayfair area, that made Sahara part of the highest league for the first time.
Reports revealed later how the money raised by issuing OFCDs was routed by Sahara to finance these big purchases.
While the industry has been abuzz with Sahara’s potential to bid for the iconic Taj Mansingh hotel in Delhi, if and when it comes up for auction, experts have often spoken about the group having deep pockets to play it big in the hospitality space.
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Ambitious Sahara bought trophy assets around the world
Bagging trophy assets such as palaces in exotic European destinations and hotel portfolios are part of its strategy, while it also scouts around in India from the mid-market to the luxury segment.
It already has its own hotel brand in Mumbai known as Sahara Star.
Even as the group came into international prominence with its hotel foray, its retail announcement hit the headlines last year with Sahara chief Subrata Roy coming out to address the media.
It announced the setting up of retail ‘Q shops’ with an initial allocation of Rs 3,000 crore and 1,700 home-branded products in the basket.
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Ambitious Sahara bought trophy assets around the world
It aimed for revenues of Rs 15,000 crore (Rs 150 billion) to Rs 20,000 crore (Rs 200 billion) in the first 12 to 18 months and as much as Rs 50,000 crore (Rs 500 billion) after two years. The progress of its retail plans is not clearly known.
A questionnaire sent to the group on its various services businesses remained unanswered till press time.
But Sahara’s retail entry through the direct selling route came at a time when the sector was under regulatory scrutiny for controversial cases including that of Speak Asia.
Interestingly, Roy had said in an interview the group was moving to the retail sector “due to the increasingly stifling regulations in the financial sector”.
Market regulator Sebi had told the Supreme Court that money invested in illegal debentures was being transferred to Sahara Q Shop, often without the consent of the debenture holders.
