With its jet-setting boss Subrata Roy in Tihar jail, India's Sahara conglomerate is scrambling for a way to satisfy a court order to repay billions of dollars in an outlawed bond scheme.
India's highest court on Tuesday ordered that Subrata Roy, 65, remain in custody until a March 11 hearing, a dramatic turn for a man accustomed to hobnobbing with sports stars, Bollywood actors and politicians. The court said it is open to an earlier hearing if Sahara has a satisfactory payment plan.
Roy is being held in a cell at Tihar jail, India's largest, with two other Sahara directors.
"We are now considering what we can do," Satish Kishanchandani, a lawyer representing Sahara told Reuters, declining to give further details. "It was urgent even before and it is urgent even today to find a solution."
Jail spokesman Sunil Gupta said Roy was receiving the same treatment as other inmates, the only privilege being that he gets a bed as he is over 60 years of age. "He slept well. He had his breakfast today," Gupta said on Wednesday.
Sahara is best known as the former main sponsor of India's national cricket team, as well as owner of New York's Plaza Hotel and London's Grosvenor House. It has a net worth of $11 billion and more than 36,000 acres of real estate, according to its website. It also co-owns the Sahara Force India Formula One auto racing team with liquor baron Vijay Mallya.
Still, Roy and unlisted Sahara have long been figures of mystery, operating outside the Indian corporate mainstream.
In court on Tuesday, Sahara lawyers offered to give bank guarantees for 225 billion rupees ($3.63 billion) within three to six months, but the court rejected the proposal and asked Sahara to come up with a "concrete" plan, according to two lawyers who were at the hearing.
Sahara also proposed that the Securities and Exchange Board of India (SEBI) begin selling Sahara properties to which it holds title until it comes up with the bank guarantee. SEBI has argued that it does not have the needed paperwork for some Sahara properties and disputed the valuation of some of them.
SEBI had brought contempt proceedings against Roy and Sahara for failure to comply with a 2012 Supreme Court order to repay billions of dollars to investors. Sahara has said it repaid most investors and that its remaining liability was less than the 51.2 billion rupees it deposited with SEBI.