Exchanges seek clarification from USL, United Breweries

Exchanges seek clarification from USL, United Breweries

Exchanges seek clarification from USL, United Breweries

 Taking a note on the arrest and the immediate bail of Vijay Mallya in London on Tuesday, the Exchanges (BSE and NSE) have sought clarification from United Breweries (Holdings) (UBHL) and United Spirits (USL), controlled by Diageo, where Vijay Mallaya is a promoter shareholder. He also established Kingfisher Airlines (KAL) in 2003.

In response to clarification, USL said that Vijay Mallya, the former Chairman of United Spirits tendered his resignation from the position of Chairman and Director on February 25, 2016. “Since then, Mallya is not involved either directly or indirectly in any of the affairs of the company and has no control over the management of the company and the shareholding of Vijay Mallya and his associate companies are below 4%,” the company said in statement.

“For some historical reasons, Mallya continues to be classified as one of the promoters of the company,” the statement added. On Tuesday, the shares of USL closed 2.53% lower at Rs 1,879.50 on BSE. UBHL still to react to the clarification from the Exchanges.

The cup of woes for liquor baron Vijay Mallya started with the collapse of Kingfisher Airlines (KAL). The company, which started operations on May 9, 2005, was grounded in 2012 with salaries of thousands of employees unpaid.

KAL reported a whopping net loss of Rs 4,301.12 crore for FY12-13. For the quarter ended September 2013, KAL had reported a net loss of Rs 715.56 crore while the loss for the December quarter for KAL stood at Rs 822.42 crore. The company's chief executive officer Sanjay Aggarwal quit in February 2014.

crore (including interest) to KAL. SBI tops the list with a loan of nearly Rs 1,500 crore. Others following SBI on the list include IDBI Bank, Punjab National Bank, Bank of India, Bank of Baroda, United Bank of India and Central Bank. In December last year, SBI had written off assets worth Rs 7,016 crore of 63 wilful defaulters, led by Mallya’s assets worth Rs 1,201 crore. Banks have tried their best to recover the loans by trying to auction various assets held by Vijay Mallya and the company.

The lenders had failed to attract any bidders for two of Vijay Mallya’s assets, namely the Kingfisher Villa in Goa and the Kingfisher House in Mumbai. After nearly three attempts, the Kingfisher Villa was finally bought by actor-businessman Sachiin Joshi for Rs 73 crore.

Banks declined to comment on Mallya’s arrest and subsequent bail in the UK. However, they can only have some cheer if Mallya is extradited back to India so that they can look at more options to recover the money that KAL owes them.