So how tough is it to do a billion-dollar deal from prison? The Sahara Group’s caged chairman, Subrata Roy, is about to find out… This will be the first time the jail has ever had to setup a space for a big business deal, said Sunil Gupta, a spokesman at Tihar…
Indian courts have thrown Mr. Roy — one of India’s richest and most controversial businessmen — into New Delhi’s notorious Tihar Jail until he finds a way to pay the billions of dollars the group owes to bond holders. He is trying to sell or leverage some of the group’s global properties to raise the money and his lawyers say he needs to be able to negotiate directly with potential buyers. An Indian court, which denied him temporary bail to do any deals, now says it will let him negotiate from prison. India’s Supreme Court recently asked Tihar Jail to facilitate online negotiations. “The Delhi Government was to issue orders to convert the prison’s conference room into a cell,” said Keshav Mohan, a lawyer for the group said. “We were given 10 working days starting August 5 to negotiate a deal.”
This will be the first time the jail has ever had to setup a space for a big business deal, said Sunil Gupta, a spokesman at Tihar. Mr. Roy will be given a computer with a web camera and an Internet connection in a big conference room near the office of the director general of the prison. The conference room, which is air conditioned and has an attached bathroom, will become Mr. Roy’s temporary home, said Mr. Gupta. “We will need to arrange for him to sleep and eat and spend his days in the conference room, just like he did in his prison cell,” said Mr. Gupta.
Mr. Roy will be allowed to wear what he likes for the negotiations. It is unclear whether he will choose one of his signature black vests as he sits down with potential buyers and lenders. While Sahara lawyer Mr. Mohan declined to discuss any potential deals, the group has said in court that it has been looking at various options, including a sale and mortgage of Grosvenor House hotel in London and the Plaza and Dream Downtown hotel in New York. Indian billionaire Cyrus Poonawalla recently told the Wall Street Journal that he has offered more than $900 million to acquire Grosvenor House hotel from the Sahara Group.
Mr. Roy and two directors of Sahara, which has business interests in sectors from financial services to media to retail, were sent to jail in March after the group failed to comply with a court order on repaying 174 billion rupees to bondholders. The Securities and Exchange Board of India saysSahara’s bond offerings didn’t follow rules. Sahara denies the charge.