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'Bankrupt' king of good times, Vijay Mallya, to celebrate his 60th with Enrique Iglesias

Vishal Manve | Updated on: 14 February 2017, 1:29 IST
QUICK PILL
  • Kingfisher Airlines is only a quarter all of the holdings that Mallya has under his possession.
  • The State Bank of India (SBI) had declared the industrialist a \'willful defaulter\' for not repaying loans worth nearly Rs 7,000 crore on the long-grounded Kingfisher Airlines

Lavish party venues, selected high-profile singers and attendees and even grander three-day celebrations. That's how 'The King of good times' Vijay Mallya seems to be rolling for his 60th birthday, despite recent announcements by the State Bank of India and CBI investigations that term his companies as 'willful defaulters'.

What's interesting is that a large number of creditor banks are trying to recover their loans from him, which according to experts, should have slowed him down considering his stature and acute business acumen.

However, Mallya is giving himself the king of all 60th birthday bashes on 18 at his Kingfisher Villa in Sinquerim, Candolim, Goa. And not just that, international singer Enrique Iglesias will perform at the venue, according to reports by the Times of India.

Just to note, Enrique is the highest paid singer in the world. So, if we were to get our hands on his pay cheque for Mallya's party, it would run to numerous zeros. So despite all the loans, filing for bankruptcies and CBI investigations, where is the king of good times getting the cash for such parties?

Incidentally, the party will also see performances from a select few including Bollywood playback singer Sonu Nigam and will be attended by celebrities, film stars, corporate barons, politicians as well as calendar girls.

So here's why we question the 'in-apropos time' of this party.

Enrique_Islegias

AFP

CBI investigations on. Search at Mallya's offices:

The chairman of the UB group, Vijay Mallya was questioned recently by the CBI in connection with the alleged loan defaults of the now defunct Kingfisher Airlines.

In October, the agency had registered a case against Mallya, Kingfisher Airlines, and A Raghunathan, the Chief Financial Officer of the airlines, apart from officials of the IDBI Bank for the alleged default of over the Rs 900 crore loan from the bank.

It is alleged that the loan was sanctioned in violation of the rules on credit limits. The CBI also searched the home and offices of Mallya in Mumbai, Goa, Bangalore and other places.

SBI tags Mallya as willful defaulter:

Prior to this, the State Bank of India (SBI) had declared the industrialist a 'willful defaulter' for not repaying loans worth nearly Rs 7,000 crore on the long-grounded Kingfisher Airlines.

"SBI has declared Mallya, Kingfisher Airlines and its holding company United Breweries Holdings as willful defaulters," sources said.

The sources said that after the Bombay High Court in August allowed Mallya to be represented by his legal counsels, the SBI moved the Supreme Court, challenging the HC order.

According to them, the HC order violated the RBI rules on the grievance redressal committee that allows only the borrower to be present for his case in person.

However, the Supreme Court upheld the High Court verdict and asked the SBI to reconsider this only as "a one-off instance" and allow Mallya's lawyers to represent him at the grievance redressal committee meeting which was held recently.

Banks unable to recover dues:

Kingfisher Airlines, grounded since October 2012, owes over Rs 7,000 crore to bankers who have been trying to recover their money by selling securities pledged by the firm. These include real estate properties and shares in group entities. Banks so far have managed to sell about 4 lakh shares of United Spirits for Rs 104 crore last year.

The battle goes on:

Earlier this year, the board of United Spirits Ltd (USL), now controlled by Diageo Plc., had asked Mallya to resign as chairman and director after an internal investigation suggested that he may have been involved in financial irregularities at the liquor firm.

Plus, Mallya was forced to resign as chairman of Mangalore Chemicals and Fertilizers Ltd (MCFL), another UB Group company, but he was still able to engineer a sale to his preferred partner.

As reported by Mint, Mallya partnered with his friend, industrialist Saroj Kumar Poddar, to ward off a takeover bid for Mangalore Chemicals from Pune-based Deepak Fertilisers and Petrochemicals Corp. Ltd.

Poddar persuaded Mallya to back him and, along with the strength of his own 16.4% stake, made sure Deepak Fertilisers didn't get close to acquiring a majority stake in Mangalore Chemicals.

Too bankrupt to clear dues. Stable enough to spend on lavish parties?

Kingfisher Airlines is only a quarter all of the holdings that Mallya has under his possession. By using bankruptcy as a filler, he is safeguarding his other investments and assets without clearing his dues.

Though CBI, SEBI and the government are closing their ring on him and even the RBI is seeking to auction Kingfisher villa to clear bank's dues, Mallya is fending them off. His Kingfisher breweries is still the biggest asset owned by the Mallya group coupled with other investments. So, even if we question his financial records, can we really stop the party from going on?

Not really! After all, Vijay Mallya is the 'King of good times' even in dire days.

First published: 16 December 2015, 1:50 IST
 
Vishal Manve @VishalManve12

Vishal Manve handles business and international relations beat for Catch. Previously, he has worked with Scroll.in and Daily News and Analysis and has interned with BBC World News and Gateway House council on global relations. Currently, he is pursuing Law from Government Law College, Mumbai. In his free time, Vishal researches on various aspects of foreign policy, human rights and feminism and looks for people who will share their stories with him.

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