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  1. Mirach Capital hits back at Subrata Roy’s Sahara group over forgery allegations; offers to buy out hotels

Mirach Capital hits back at Subrata Roy’s Sahara group over forgery allegations; offers to buy out hotels

A 'non-defiant' Mirach offers a full buyout of Sahara Group's 3 iconic hotels in the US and the UK.

By: | New York | Updated: February 6, 2015 1:05 PM
Subrata Roy, Sahara Group, Sahara hotels

Stung by a ‘forged letter’ claiming billion funding through Bank of America, crisis-hit Sahara Group had said it has been ‘cheated’ by US-based Mirach Capital. The Subrata Roy-led firm has said it would take all suitable legal action against Mirach. (Reuters)

Hitting back at Sahara, US-based Mirach Capital today rejected accusations of indulging in forgery and counter-accused the Indian group of walking out of the $2 billion loan arrangement fearing repayment defaults.

Mirach refused to comment on earlier claims that the banker arranged by it for the deal was Bank of America, whose denial being party to any such transaction blew the lid on the alleged forgery.

However, a ‘non-defiant’ Mirach offered a full buyout of Sahara’s three iconic hotels in the US and the UK.

In a statement, Mirach CEO Saransh Sharma steered clear of the issue of a Bank of America letter it furnished as guarantee of funds in an escrow account for Sahara, which then placed it before the Supreme Court but later found it to be “forged”.

He further accused Sahara of repeatedly undermining a transaction for sale of its properties and said it “wasted” the time of its investors as also that of Sebi and the courts.

“In light of recent comments made by Sahara, we would like to offer the following details in an effort to provide transparency and give a comprehensive view of what has transpired to date.

“Mirach has faced a number of challenges in closing this transaction; nevertheless, we remain steadfast and are ready, willing, and able to acquire these assets,” he added.

Sharma further said: “The Amicus Curiae, Sahara’s legal counsel, Subrata Roy, and other essential parties, including our investors, have been made privy to the details indicating our willingness and ability to successfully execute this transaction.

“In spite of the court mandates to raise bail, Sahara has always been and continues to be an unwilling seller of these assets. They have thus repeatedly acted to undermine the transaction, and thereby waste the time of our investors, Sebi, and the Honourable Supreme Court of India.

“The dangerous allegations made by Sahara are indicative of a direct intent to destabilise a deal structure that, given its high rate of return, would benefit Mirach and its investors.”

Stung by a “forged letter” claiming USD 2-billion funding through Bank of America, crisis-hit Sahara Group had yesterday said it has been “cheated” by US-based Mirach Capital and would take all suitable legal action against the firm and its officers.

Reacting to it, Sharma said: “Initially, Mirach Capital Group reached a deal with Sahara to provide a structured loan package, including taking over the debt on the foreign assets from Bank of China, and a sale of the Indian assets.

“Consistently, Mirach has been interested in an outright sale of the assets, however, Sahara would only agree to exclusivity under the loan structure as outlined.”

He added: “Upon recognising their inability to make the first interest payment on the loan, and thus in danger of losing their assets at a discounted rate through default, members of the Sahara Group violated the exclusivity agreement and began shopping the assets for a sale.”
Sharma further said: “We learned of this after representatives of the Sahara Group approached members of Mirach’s syndicate.

“Following Mirach’s multiple notices to Sahara that they were in breach of contract, Sahara then began to take an adversarial position against Mirach, and began to attempt to discredit and smear Mirach’s reputation.”

He added: “Any such claims of Sahara being defrauded by Mirach are untrue and are being presented in an effort to unravel the deal and shelter Subrata Roy.

“Proof of Mirach’s financial capabilities were previously verified directly with Sahara’s lawyers, and a simple meta data test will show no documents have been forged.

As per submissions made before the Supreme Court last month, Mirach was to conduct this deal through funds deposited in an account with Bank of America, which was proposed to transfer funds to the accounts of two Sahara entities.

Sharma further said, “Upon agreement of Sahara with support from the Supreme Court of India to a sale of the assets, Mirach stands ready to publicly disclose the identity of our investors who have historically earmarked funds for this transaction to which Mirach has had access.

“Numerous financial institutions, legal counsel, and investors, have repeatedly declined the opportunity to engage with this transaction because of the public profile and legal troubles of Roy.”

He added: “Mirach likewise recognised the associated risks, but nonetheless was committed to rescue the distressed assets in the centre of this proposed structure.

“In light of the breach of contract, Mirach is no longer considering an offer for the loan structure, however, remains ready, willing and able to facilitate an acquisition of these assets.”

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