Subrata Roy has been incarcerated after running afoul of a number of India’s financial regulations
December 4,2014:We’ve seen life imitate art but rarely have we seen life imitate a board game. In Hasbro’s popular board game, Monopoly, players often land in jail as well as own massive hotels on Park Place and other iconic locations. What you cannot do in Monopoly, however, is trade your hotel for bail money, but that’s exactly what Sahara Group chairman Subrata Roy has been trying to do for the past several months.
Roy has been incarcerated in India since late February of this year, when India’s Supreme Court decided to take action after a protracted battle between Roy and the Securities and Exchange Board of India. Roy is accused of defrauding investors through unsecured fundraising schemes and running afoul of a number of India’s financial regulations. He has fought, appealed and disobeyed a number of court orders over the past two years, but only recently sought permission to leave the country in order to “take care of his overseas business interests,” according to Yahoo! Finance. He was arrested shortly thereafter.
Roy has enjoyed the fruits of financial success, rising from poverty to massive wealth through banking, airline and now real estate ventures, amassing a network of companies worth tens of billions of dollars and hobnobbing with the country’s movie stars and wealthy elite.
Iconic hotels for sale
As part of Roy’s ploy to raise over a billion and a half dollars in bail money, he’s offered to sell his stake in three hotels: The Plaza and The Dream in New York City, and the Grosvenor House in London.
The Plaza has been featured in multiple American films and remains a major tourist destination, as well as a hotspot for the wealthy and famous. Other former owners of The Plaza Hotel, which was designated a historic landmark in New York City in 1986, include Donald Trump and Conrad Hilton. Roy’s stake through the Sahara Group is valued at $592 million, according to The Financial Express
PLAZA HOTEL, NEW YORK
The Dream is a boutique hotel near New York’s Chelsea neighborhood and other nightlife and shopping hot spots. The Sahara Group’s interest in the hotel is valued at $252 million, according to The Financial Express.
DREAM DOWNTOWN HOTEL, NEW YORK
Roy’s biggest item, however, is the Grosvenor House, London’s biggest luxury hotel with a royal past. The Sahara Group’s stake in the famous building is worth a whopping $879 million, according to the Financial Express.
GROSVENOR HOTEL, LONDON
While Roy has been living the life of real estate royalty, it may in fact take a king to bail him out of jail. According to Jon Rosenthal of Crillon Capital in Thousand Oaks, California, the polarizing Sultan of Brunei is “still considering buying the properties”. In October, several websites carried news stories of a proposed $2.2 billion dollar deal in which the Sultan would purchase all of Roy’s interests in the three hotels.
Others have speculated that there are as many as five possible buyers, including a businessman from China and a royal family from the Middle East. Adar Poonawalla, son of Indian billionaire Cyrus Poonawalla, allegedly made an offer of more than $900 million for Roy’s stake in the Grosvenor Hotel.
David Drake is an early-stage equity expert and the founder and chairman of LDJ Capital, a New York City-based family office, and The Soho Loft Media Group, a global financial media company with divisions in Corporate Communications, Publications and Conferences.
Is there something like better tobacco?
Anatomy of a real estate crowdfunding transaction