Flow of funds

How money flowed into Jagans companies & benefits went to Investors:

Y S Jaganmohan Reddy and his father former CM Y S Rajasekhara Reddy had ingeniously created 49 dummy companies all over the country to launder the bribe money they received through QPQ formulae .

The modus operandi was very simple investors favored with land allocations in exchange for their buying shares of the dummy companies at exorbitant premiums fixed by Jagan and CO, says the CBI FIR .

About 22 small companies with out proper addresses based in Howrah, Kolkata, Mumbai, Rajkot, Bangalore, Delhi and Tamil Nadu have invested about Rs. 195.7crore in Jagathi Publications. Another 16 companies which were not listed on BSE and based in Chennai and Hyderabad were also mentioned to have invested Rs. 107 crore in Jagathi, Sandur Power and Carmel Asia. All these firms were allegedly without any significant income or assets but floated by Jagan and co only.

Here is a brief list of companies and individuals who invested in Jagan ‘blade companies‘.

1)Nimmagadda Prasad and Matrix Group of Companies: Nimmagadda Prasad of Matrix fame who later sold it to US-based Mylon Group.

  • Investments: Rs. 100 crore in Jagathi Publications, Rs.140 crore in Sandur Power, Rs.20 crore in Carmel Asia and  Rs.244 crore in Bharathi Cements ( total Rs.604 crore ).
  • What he got in return : Prasad was allotted 15,000 acres in Prakasam district for the VANPIC (Vadarevu and Nizampatnam Port and Industrial Corridor) project on the east coast.

2)P Pratap Reddy, Penna Cements Group and Pioneer Infra: Penna Cement Industries Limited was formed by P Prathap Reddy, a Congress leader and close confidant of YS Rajasekhara Reddy who also owned Pioneer Infrastructure Holding Ltd.

  • Investments:Pioneer Infra invested `20 crore in Jagathi Publications, while Penna Cements Group invested `45 crore in Jagathi Publications and `23 crore in Carmel Asia Holdings.
  • Returns: Pioneer Infrastructure Holdings was given various contracts in Jalayagnam with favorable terms apart from relaxation in construction of a building at Road No 2, Banjara Hills. The limestone mining leases over 536.65 hectares of hectares in Kurnool and Ranga Reddy district.

3)Ramky Group of Companies: The Ramky Group has a turnover in excess of `4,500 crore and focused in areas of civil, environmental and waste management infrastructure with specific emphasis on Public-Private Partnership projects.

  • Investments: `10 crore in Jagathi Publications.
  • Returns: Allocation of land at Gachibowli, an SEZ in Visakhapatnam, a township project at Maheswaram in Rangareddy, waste material processing project worth Rs.897 crore under JNNURM.

4)Aurobindo Pharma Ltd: Among the largest vertically integrated pharmaceutical companies in India, with global presence with own infrastructure, strategic alliances, subsidiaries and joint ventures.

  • Investments: Rs.10 crore in Jagathi Publications.
  • Returns: Allotted an SEZ at Nakkapalli (Visakhapatnam) with a group of companies.

5)PVP Ventures and Group of Companies: The Group is owned by Varaprasad Potluri who is into construction and contracting.

  • Investments: `146.97 crore in Jagathi Publications.
  • Returns: PVP Business Ventures allowed to buy 595 acres in Nadargul (Hyderabad) in Saroonagar mandal of Rangareddy district.

6)Hetero Group of Companies: Hetero is a research-based global pharmaceutical company building on strengths of vertical integration in discovery research, process chemistry, API manufacturing, formulation development and commercialization.

  • Investments:Rs. 4 crore in Jagathi Publications and Rs. 13.25 crore in Janani Infra.
  • Returns: Allocation of 240.07 acres of land for Nakkapalli SEZ in Visakhapatnam district and Jadcherla SEZ in Mahaboobnagar.

7)Mantri Developers Pvt Ltd: Established by Sushil Mantri, Mantri Developers is one of India’s leading real estate developers building residential properties, IT parks, shopping complexes, commercial buildings and educational institutions.

  • Investments: Handing over a commercial building worth `500 crore and annual rental of `30 crore in Bangalore to Classic Realty Pvt Ltd, owned by Jagan Mohan Reddy.
  • Returns: In collaboration with Brahmani Infra Tech owned by Jagan, the company got hold of 250 acres land located near the Hyderabad International airport for `20 lakh per acre as against an alleged market price of `1.5 crore per acre.

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