• India
  • Nov 15

Who was Subrata Roy?

Sahara Group chief Subrata Roy died due to a cardiorespiratory arrest at a private hospital in Mumbai on November 14. He was 75.

‘The second-largest employer in India’

• Born in Araria (Bihar), he joined a company called Sahara Finance sometime in the mid-1970s and turned it into a repository of very low-amount deposits. 

• He made a modest start with a capital for only Rs 2,000.

• As the company, he later took over, grew, Roy built its head office in Lucknow.

• Roy had made the Sahara Group a multi-billion dollar enterprise that counted itself among the biggest employers of the country.

• The company was once hailed as “the second-largest employer in India after Indian Railways”.

• He was also known to have friends among the famous and powerful across the fields of politics and Bollywood.

• Having scripted one of the most famous rags-to-riches stories of the country, Roy went on to expand his business across various sectors ranging from finance, housing, manufacturing, aviation and the media and became a household name.

• The group launched Sahara TV, which was later renamed Sahara One. Hindi language newspaper Rashtriya Sahara was started in 1992.

• His enterprise went on to own landmark global properties, including New York’s Plaza Hotel and London’s iconic Grosvenor House.

• Under his leadership, Sahara also sponsored the Indian cricket and hockey teams and owned a Formula One racing team.

Battle with SEBI

• His troubles began in November 2010 when stock market regulator Securities and Exchange Board of India (SEBI) asked two entities of Sahara Group not to mobilise funds from equity markets or from issuance of any security to the public while restraining Roy from approaching the public for raising money.

• Two Sahara Group companies — Sahara India Real Estate Corporation (SIRECA) and Sahara Housing Investment Corporation — raised funds in 2007-08 through a debenture instrument OFCD.

• Later in June 2011, the regulator asked the two group entities to refund money collected from investors through Optionally Fully Convertible Debentures (OFCD) along with the return.

• After a long process of appeals and cross-appeals, the Supreme Court had ordered in 2012 refund of deposits of its investors along with 15 per cent interest.

• Sahara was eventually asked to deposit an estimated Rs 24,000 crore with SEBI for further refund to investors, though the group always maintained it amounted to “double payment” as it had already refunded more than 95 per cent of investors directly.

• Roy was arrested in 2014 on the orders of the Supreme Court after he failed to appear before it in a contempt case arising out of non-refund of more than Rs 20,000 crore to investors by two of his companies.

• Roy came out on parole after spending over two years in prison on May 6, 2016 to perform the last rites of his mother Chhabi Roy. He has been out of prison since then.

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