Ernst scripts Sahara makeover

Group to focus more on real estate ventures.

After sealing a $500 million Air Sahara deal, the Sahara group is now ready for corporate restructuring. The group has engaged Ernst & Young "" the consultancy firm which advised it on the airline sale "" to chalk out a restructuring plan.

In a move that one can interpret as a "succession plan", the two sons of Sahara chief Subroto Roy "" Sushanto and Seemanto "" will now play a larger role in the group. Besides, some of the group businesses will get sharper focus and a few of them will probably be hived off into separate subsidiaries.

Overall, Ernst & Young's mandate will be for professionalisation of the family-run company. "With businesses growing, the group has realised that it can no longer be a one-man show," said a source close to the development.

Though Roy's sons were not given any formal role to play in the organisation, they were briefly seen in action during Roy's illness. Roy, 58, has been discussing the subject with Ernst & Young for quite sometime now, but the firm will formally take over the assignment next month.

According to sources, the residuary non-banking finance company "" Sahara India Financial Corporation "" is likely to remain under Roy's control as he is not ready to hang up his boots.

However, the group will increasingly focus on its real estate ventures. A large chunk of the proceeds from the airline sale will be invested in this business where Roy's sons will play a key role.

The group has two projects on hand "" the Amby Valley project and CityHomes. Sushanto will be in charge of the Amby Valley project and younger brother Seemanto will handle CityHomes.

The film company, Sahara India Mass Communication, will also probably be Sushanto's responsibility. "This is the only listed company of the group and it has ambitious plans," sources said.

Sahara India Financial Corporation will become the official sponsor for the Indian cricket team, with the Board for Control of Cricket in India (BCCI) having transferred the contract to it from Sahara Airlines. The finance company has also met BCCI's criteria including that of having a turnover of Rs 1,000 crore.

Sahara Indian Mass Communication posted net profit of Rs 6.5 crore over sales of Rs 168.5 crore in 2004-05. Sahara Indian Finance Corporation posted sales of Rs 984.4 crore and net profit of Rs 44.7 crore in 2003-04.

Sahara India Housing Finance Corporation ended 2003-04 with net profit of Rs 2.5 crore over sales of Rs 4.3 crore.

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Future plans

Group to focus more on real estate ventures

Subroto Roy's two sons Sushanto and Seemanto to play a larger role in the group

Sushanto to be in charge of the Amby Valley project and Sahara India Mass Communications

Younger brother Seemanto to handle CityHomes

Sahara India Financial Corporation to remain under Subroto Roy's control