Legal panel allows Vijay Mallya to head United Breweries

Vijay Mallya would continue to be chairman of United Breweries (UB), majority stake held by Dutch beverage maker Heineken, after a legal panel gave its affirmation for the liquor baron to continue in office.

The board of directors will review the position of Mallya, under self-exile in Britain, at its next meeting on August 12. The Economic Times first reported  the development, on Thursday.

UB had sought legal opinion on Mallya's status after a notification by the Securities & Exchange Board of India (Sebi) said a person named a wilful defaulter could not be nominated to a board position. Mallya, who has been so named, has contested the Sebi move, saying that he's chairman and promoter of the company and did not require a nomination.

 

HEAD OF BOARD?

• The board of directors will review the position of Vijay  Mallya at its next meeting on Aug 12
   
• UB had sought legal opinion on Mallya’s status after a notification by Sebi said a person named a wilful defaulter could not be nominated to a board position
   
• Mallya has contested the Sebi move saying he’s chairman and promoter of the company and did not require a nomination
   
• He holds 30.71% stake in UB, personally or through his companies such as United Breweries (Holdings) Ltd and other investment arms

Mallya holds 30.71 per cent stake in UB, personally or through his companies such as United Breweries (Holdings) Ltd and other investment arms. However, half of it is pledged with banks and financial institutions as collateral for loans taken to run the long-defunct Kingfisher Airlines.  

Mallya, who once presided over the country's largest organised liquor and beverage empire, lost majority stake to global giants Diageo and Heineken after his airline venture went bankrupt in 2012. Mallya pledged most of his shares to repay dues, while still owing banks Rs 7,200 crore in unpaid loans. The banks, led by State Bank of India, have filed cases against Mallya in several courts to recover the money. Mallya is also being investigated by the Enforcement Directorate on charges of money laundering. And, the government has cancelled his passport, after he failed to respond to notices and jumped bail. 

Earlier this week, the Supreme Court asked Mallya why contempt proceedings should not be initiated against him after he failed to honour its direction to disclose all his assets globally.

Re-auctioning of Mallya jet
The service tax department will re-auction the luxury jet of Vijay Mallya on August 18, possibly at a lower reserve price. The department had failed to get a good valuation in the first attempt to auction the jet last month where it had received a bid of Rs 1.09 crore against the reserve price of Rs 152 crore. (PTI)