Sahara Group to go slow on realty arm stake sale

MUMBAI: The Sahara Group is going slow on its plan to raise money by selling shares of its real estate arm but it has not shelved the idea of approaching the market, says its chairman. “The stock market sentiment has improved recently,“ group chairman Subrata Roy told ET. “But it’s still not conducive to fund raising by realty firms.”

Sahara Prime City, the real estate arm of the group, had filed its application to launch an initial public offering (IPO) with the market regulator the Securities and Exchange Board of India (Sebi) in September last year but has not received the regulator’s approval.

“Since we are not sure about the market conditions, we are not following it up with Sebi,” he said on Tuesday evening after inaugurating Celestial, an education infrastructure company constituted as a joint venture between Chicago-based STL and Chandra Education. Under the country’s capital market norms, a company is required to complete an IPO within a year after receiving Sebi’s approval. If it fails to do so, it will have to file fresh application with Sebi.

Eight companies had filed IPO applications towards the end of September last year and seven have been cleared by the regulator. Of these, five have since accessed the market while drugmaker Glenmark has postponed its offer and Emaar MGF, another real estate company, is yet to launch its IPO. The Sahara application remains on the regulator’s desk.

ET had reported in July that the Sahara IPO was delayed because of complaints from investors in some of its schemes. Mr Roy, who has always been in the limelight because of his proximity to cricketers and actors, said he is open to an out-of-court settlement of a dispute stemming from a multi-crore rupee takeover deal with Jet Airways, which acquired Sahara’s airline business three years ago.

Sahara India Commercial Corporation had taken the Naresh Goyal-controlled Jet Airways to court, saying Jet was liable to pay Rs 2,000 crore instead of a re-negotiated amount of Rs 1,450 crore for the buyout of the erstwhile Sahara Airline, now known as Jetlite.

The price was brought down to Rs 1,450 crore on the condition that Jet would not default on payment. But it defaulted and so the concession was not tenable, Sahara India said in its petition. The case is now pending with Bombay High Court.