 "Vijay Mallya")
United Spirits was reluctant to share information on loans to several entities owned by Vijay Mallya, Enforcement Directorate (ED) officials said. “The statements of the management have been evasive,” said a source with the ED, which has summoned United Spirits executives for further questioning this week.
A USL spokesperson said, “We will share the EY report with the appropriate authority and will cooperate with them fully in any action they may take in relation to this matter.”
The ED has been seeking information on the November 2012 agreement in which Diageo agreed to acquire a 53.4 per cent stake in United Spirits from Mallya’s UB Group for $2.05 billion.
The agency believes documents provided by United Spirits are incomplete. It also plans to examine a report by EY and an earlier report by PwC UK, which led to the United Spirits board seeking Mallya’s dismissal.
On Saturday, United Spirits informed stock exchanges that additional inquiry into the accounts showed fund diversion of Rs 1,200 crore to various Mallya-owned entities, including Force India, Watson and Kingfisher Airlines.
“We need to know what prompted them to conduct the audit now. An earlier audit report clearly indicated the diversion,” an ED official said. “We have asked the company to submit financial details of the diversion claimed,” he added.
The ED is cosidering attaching Mallya’s Formula 1 assets. The ED has so far attached nine assets of Mallya and United Breweries Holdings worth Rs 1,411 crore crore under anti-money laundering laws. The ED had in March registered a case against Mallya, Kingfisher Airlines and IDBI executives under the Prevention of Money Laundering Act.
The Securities and Exchange Board of India (Sebi) was likely to summon United Spirits executives to explain Diageo’s severance package of $75 million to Mallya, said a source. Sebi is probing violations of disclosure and corporate governance norms and plans to inspect the role of independent directors, auditors and other board members of United Spirits.
“The Sebi investigation wing is taking over the probe after a report from its surveillance department," the source added. Sebi is coordinating with the ministry of corporate affairs on the United Spirits investigation. Besides, auditors for the company between 2002 and 2011 are also on the regulator’s radar.
While email sent to Sebi did not elicit response.
