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India’s Sahara Group being investigated on its high profile hotel buys in UK & US

Excerpt from Economic Times

Jan 05, 2013 8:26 pm

Skift Take

For now, this investigation is for Sahara’s UK deal, but likely will extend to its acquisition of New York’s iconic Plaza Hotel as well. That will surely put a dampener on any new Sahara hotel deals going ahead.

— Rafat Ali

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In December 2010, Sahara bought the iconic hotel Grosvenor House, in London’s Mayfair area for £470 million. Sahara’s announcement led India’s Enforcement Directorate, which was already looking into various deals of controversial group, to trace the money flow behind financing the acquisition.

The agency…suspects that Sahara routed funds in a way so as to avoid taking the permission of the Reserve Bank of India, which has the last word on cross-border flows. It is investigating whether the transactions, particularly the fund remittance under the automatic route, have been in violation of foreign exchange regulations.

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