Bengaluru: Mallya to chair United Spirits AGM despite minority stake

Bengaluru, Sep 28 (IANS) Liquor baron Vijay Mallya on Monday said he would chair the annual general meeting (AGM) of United Spirits Ltd (USL) despite holding a minority equity in the Diageo-led spirits major.

“As I am still chairman and hold a significant portion of equity shares in USL, I will chair its AGM for 2014-15 when held,” Mallya told shareholders at the AGM of United Breweries (Holdings) Ltd here.

Though AGM of USL for last fiscal has not yet been decided, London-based global spirits major Diageo Plc, which has majority stake (54.78 percent), had urged Mallya to step down in view of his stake being a mere 0.01 percent in his personal capacity and 4.09 percent through his UB group firms.

“As the company (USL) is yet to file annual report for fiscal 2014-15 to the regulatory authorities (stock exchanges), date for its AGM has not been decided,” said Mallya.

At an emergency board meeting on April 25, Diageo sought Mallya’s resignation from the USL board following charges that its funds were diverted to the UB group entities under his chairmanship. He had declined to step down.

Global audit firm Pricewaterhouse Coopers (PwC) submitted a report to Diageo that Rs.3,000 crore of USL were diverted to UB group by its previous board, led by Mallya.

Reiterating his position, Mallya asserted that as per a deal he had with Diageo in November 2012, he would continue as USL chairman for five years (till 2017).

The company, however, said in a statement later that its board lost confidence in Mallya and hence should resign as its director and chairman.

Meanwhile, in the UB Holdings AGM, its auditors (Vishnu Ram & Co) warned the management that its liabilities would raise to Rs.7,730 crore for not settling outstanding amounts, including debts over the last couple of years.

“Corporate guarantees to the tune of Rs.8,707 crore to lenders of Kingfisher Airlines by the holding firm (UBHL) is a matter of concern, as the airline has not been operating since it was grounded in October 2012,” the auditors said in the annual report for 2014-15.

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