India: The Enforcement Directorate takes possession of Vijay Mallya’s stake in United Breweries
The Enforcement Directorate has taken possession of liquor baron Vijay Mallya’s stake in United Breweries and also stakes in other listed companies, a senior ED official told Moneycontrol.
Labelled a willful defaulter by banks, Mallya owes lenders Rs 8,191 crore as of December 31, 2016, according to a written reply in the Rajya Sabha by Minister of State for Finance Santosh Kumar Gangwar.
Mallya owns around 8 percent directly in United Breweries and another 22 percent through privately held firms. Mallya also directly owns around 7 percent in United Breweries Holdings, and also shares in United Spirits.
In the case of United Breweries, nearly the entire direct holding and a little over a quarter of the indirectly held stake is pledged with banks.
According to a report in a business daily, Heineken had recently approached the banks with a proposal to buy out all of Mallya’s United Breweries shares pledged with them. Heineken owns a little over 43 percent in United Breweries, which makes the Kingfisher brand of beer.
The Dutch beer giant has been looking to hike stake in UB for a while now.
With the ED now taking possession of Mallya’s stake in United Breweries, Heineken cannot increase its stake in the company by buying Mallya’s shares.
While ED has possession of the shares, it cannot sell them unless it gets a confiscation order from the court.
So far, the ED has attached roughly Rs 9700 crore worth of movable and immovable properties of Vijay Mallya, and has taken possession of roughly 80 percent of those, the ED official said.
The ED is hopeful of getting a confiscation order at the earliest.
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