New contenders consider London's Grosvenor House buy


The Sahara Group saga just keeps on spinning. Back in February, The Sahara Group announced that it had sold its Grosvenor House Hotel in London to the state of Qatar for an undisclosed price. That deal has since fallen apart, and now, a member of the Saudi royal family is reportedly setting up a £1 billion bid to buy the Mayfair hotel along with two New York hotels from India’s Sahara Group.

A consortium made up of the family office of the royal family member and 3 Associates Capital is close to formalizing the all-equity offer. Notably, the deal values the Park Lane hotel at £600 million, which makes it the biggest single hotel deal ever in the U.K. (Appropriately, when Sahara bought Grosvenor House for £470 million in 2010, it was the largest London hotel deal on record at the time.) 

The consortium is reportedly also considering deals for the New York Plaza hotel and The Dream Hotel at £240 million and £160 million, respectively.

The Sahara Saga

The sale of these assets has been an ongoing international drama going back to the arrest of Sahara Group founder Subrata Roy. Roy was jailed after failing to appear at a contempt hearing in a long-running legal battle between his group and the Indian capital markets regulator. 

The three hotels were put on the market more than two years ago to raise funds for Roy's £1 billion bail, and several potential buyers for the individual assets or all three properties have come and gone since then. 

The Saudi royal family member and 3 Associates have tapped Knight Frank to oversee the bid and are reportedly preparing a formal offer through the Supreme Court in India, which is administrating the sale of Sahara assets to repay investors.

Dream Hotel
New York's Dream Hotel

Insiders believe that the consortium has agreed to a deal with "a well-known New York family" to sell on the New York Plaza and The Dream Hotel if this new deal goes through.

Other Contenders?

Other parties have also expressed interest in the hotels over the years. Billionaires David and Simon Reuben took over the senior debt on Grosvenor House from the Bank of China last year and reportedly considered taking ownership of the hotel.

Last year, British property developer and financier Kane Capital Partners and U.S.-based investment bank Madison Capital Holding separately submitted applications in the Supreme Court to buy the properties in London and New York but they were rebuffed by Sahara.

Source: Property Week