Mirach Capital Group, a group of investors that includes Fugees founder Pras Michel, sports agent David Sugarman and Saudi Prince Alwaleed bin Talal, is lending $1.55 billion to the owner of the Plaza Hotel in an effort to gain control of the property.
Sahara Group, an Indian conglomerate, owns the hotel, while the company’s imprisoned chairman Subrata Roy allegedly owes $6 billion to Sahara’s bondholders. Mirach Capital plans to spend roughly $900 million to retire the debt taken on by the Plaza — as well as the Dream Hotel and London’s Grosvenor House, according to the Wall Street Journal. Part of the remaining $1.55 billion will go toward bail to free Roy from a New Delhi jail.
The hotels were put up for sale earlier this year and garnered interest from several investors. Sahara has been looking to refinance the properties, rather than selling them, according to the newspaper.
Bin Talal has said that he’d like to increase his 25 percent ownership in the hotel. Mirach would like to take ownership of all three properties. If Sahara defaults on the debt — — which carries an interest rate of more than 11 percent — the investors would be in a position to take control of the hotels.
“What sparked our interest initially was the Plaza, but we want to own all three,” Sugarman told the Journal. [WSJ] — Claire Moses