Updated: October 5, 2021 10:45:00 am
The now arrested promoter of bankrupt travel firm Cox and Kings Ltd, Ajay Ajit Peter Kerkar, owns two BVI trusts and is connected to at least half a dozen offshore firms, an investigation of records in the Pandora Papers reveals.
Most of these firms were set up by Kerkar and his business partner Shyam Maheshwari, non-resident Indian between 2010 and 2016. Maheshwari is a partner at Ares SSG Group, a global alternative investment management firm.
Kerkar is accused of money laundering and was arrested by the Enforcement Directorate (ED) in November 2020. His firm, Cox and Kings, came under the scanner after the ED initiated an investigation into allegations of kickbacks taken by Rana Kapoor, former co-founder of Yes Bank Ltd. Cox and Kings owes Rs 5,500 crore to banks and financial institutions and was one of the top borrowers of Yes Bank .
Documents investigated by The Indian Express show the two BVI vista trusts —The Welcome Trust and The Castle Cove Trust — were both set up in March 2010 with Kerkar, his wife Emma Patience Tully, and their two daughters as the ultimate beneficial owners and Aleman, Cordero, Galindo & Lee Trust (BVI) Ltd as their trustee.
While the Welcome Trust controls a BVI firm Coad Investments Ltd, the Castle Cove Trust holds shares of Castleman Management Ltd. The initial settlement corpus of Castle Cove Trust was shares worth $50,000 of Castleman Management, according to its trust deed.
Records show that between September 2015 and October 2016, Kerkar, through Castleman Management, became a guarantor to a $45-million loan given by Cayman Islands-based SSG Secured Lending Opportunities to Kubber Investment (Mauritius) Pvt Ltd, a shareholder of Cox and Kings. Similarly, Coad Investments, too, became a guarantor for loans of $34 million taken by Kubber Investment from SSG Secured Lending between 2014 and 2016.
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Incidentally, Kubber Investments is being probed by ED for allegedly siphoning around $15 million from the sale proceeds of Holiday Break Education Limited, a UK subsidiary of Cox and Kings. Holiday Break Education was sold for Rs 4387 crore in 2018. The ED has alleged that Kubber Investments is owned by Kerkar.
Emails and phone calls to Kerkar’s lawyer Akhilesh Dubey did not elicit any response.
Castleman Management is also under investigation after the arrested chief financial officer of Cox and Kings, Anil Khandelwal, in a statement to the Economic Offence Wing (EOW) of the Mumbai Police, alleged that the BVI firm has “siphoned” Rs 450 crore from Cox and Kings Asia Pacific Travel.
Records show that Kerkar and his associates have set up a number of offshore companies: Shirmont International Ltd; Coad Financial Management Ltd; Castleman Financial Management Ltd; Blue Kite Investments Ltd in the BVI; Courbet Holdings Ltd in Cyprus; and SSG Special Opportunity II Ltd in the BVI.
While Kerkar is the sole director at Coad Financial and Castleman Financial, Maheshwari is a director at Blue Kite, Courbet and SSG Special Opportunity II. Maheshwari’s wife Sulata Maheshwari is the sole director at Shirmont International, a personal company of the Maheshwaris. Blue Kite, Courbet and SSG Special Opportunity II are a part of Ares SSG.
“Any entities Ares SSG establishes in connection with its fund investment activities are for specific and legitimate business purposes and are formed based on the advice of third party professional legal and tax advisors in full compliance with the law”, said a spokesperson for Ares SSG in response to queries from The Indian Express.
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