I am not an absconder: Under-fire Vijay Mallya hits out at the media

MUMBAI(PTI): Under fire over huge unpaid loans of long-defunct Kingfisher Airlines, a defiant Vijay Mallya said he is making efforts to reach a ‘one-time settlement’ with banks through additional payments to the lenders, even as he denied “personally” being a “borrower or judgement defaulter” and alleged that “disinformation campaign” was being played to make him a “poster boy” of all bad loans. Rejecting allegations that he is an “absconder” in the wake of his statement to spend more time in England after signing a “sweetheart” deal with Diageo, the liquor baron said he will continue to cooperate with investigative agencies related to the loans provided by banks to long-defunct Kingfisher Airlines.

Mallya, who has agreed to step down as Chairman of United Spirits Ltd in return for USD 75 million to be paid by Diageo, also insisted that he is not a “borrower or a judgement defaulter” and he has challenged the “willful defaulter” tag by some banks, which he alleged didn’t go after borrowers who “owe much more than the amount allegedly owed by Kingfisher Airlines”.
He also alleged that SBI, which has dragged him to Debt Recovery Tribunal (DRT) seeking his arrest and seizure of his passport to claim his Rs 515 crore sweetheart deal to exit United Spirits, was well aware of the financial stress of Kingfisher Airlines for a long time and the same was reported by the state-run lender to RBI way back in January 2012 — months before the once-luxurious air carrier was grounded in October that year.Mallya, who was widely known as ‘King of Good Times’ and his lavish parties before his businesses started plunging into one after another crisis resulting in sale or closure of various companies, also said that while banks would eventually recover a “substantial part of their debt”, the loss for his group is permanent.

Putting the blame also on media and the TRP race, he said in a statement banks in India have NPAs of Rs 11 lakh crore and have borrowers who owe much more than the amount allegedly owed by Kingfisher Airlines (KFA) –“a fact never alluded to or widely reported by the media as in my case”.
The statement came a day before DRT is scheduled to give its verdict on the plea of SBI, which leads the consortium of banks that are seeking to recover loans worth about Rs 8,000 crore alongwith interest and penalties. “I have been most pained as being painted as an absconder I have neither the intention nor any reason to abscond. I have been a non-resident for almost 28 years and the Reserve Bank of India has acknowledged this in writing,” he said in the statement.
Mallya has come under an intense media glare in recent weeks after a deal he inked with Diageo, the current controlling owner of United Spirits that was set up by his family but had to be sold off due to financial stress in his UB Group. After a year-long boardroom battle, Mallya last month agreed to quit as Chairman and Director of United Spirits while Diageo has agreed to pay him USD 75 million (Rs 515 crore) and shift base largely to the UK.
Recently, former staff and customers of KFA have also come out in the open seeking action against Mallya, while at least three banks have declared him, his group holding company UBHL and the airline as wilful defaulters.
He further said: “Over the years, I have built successful businesses in India and abroad. I am also honoured to be a member of the Rajya Sabha. I have been summoned before various investigative agencies and have duly attended and cooperated with each of them, and I will continue to do so.”
Reacting to what he termed as “near hysterical campaign in the media” directed against him, Mallya said: “My statement as to my personal future after quitting Diageo/USL – that I want to spend more time in England closer to my children – has been grossly distorted and misportrayed. I wish to reduce my business commitments gradually and devote more time to my family, and that my resignation from United Spirits was a step in this direction.”
The payments from Diageo Plc to him are towards his personal non-compete obligations globally except in the UK, he said. “In effect, I have given up my interests in the spirits business globally at considerable cost. I have always lived an honourable life and the calumny notwithstanding shall continue to do so,” the flamboyant tycoon added. Clarifying his position in the loan owed by KFA, he said after the closure of the airline, since April, 2013, the banks and their assignees have recovered, in cash, an aggregate of Rs 1,244 crore from sale of pledged shares.
“In addition an aggregate of Rs 600 crore is lying deposited in the Karnataka High Court (since July, 2013) and a further sum of Rs 650 crore belonging to United Breweries Holdings has been deposited in the Karnataka High Court since early 2014, being sums realized from the sale proceeds received by United Breweries Holdings from the sale of shares in United Spirits to Diageo Plc in July, 2013,” he said.
“Thus, the aggregate cash recovery/security available is Rs 2,494 crores,” Mallya said. He further said: “Legal proceedings apart, I have been making efforts to reach a one-time settlement with the Banks, and to that end I have had three meetings and follow up calls in the recent past and my efforts will continue this settlement would be based on additional payments to the Banks.
Personally I am not a borrower or a judgement defaulter.” Lamenting that he has been made “the poster boy of all bank NPA’s”, Mallya said: “In fact, banks have NPA’s of Rs 11 lakh crore and have borrowers who owe much more than the amount allegedly owed by KFA to the Banks a fact never alluded to or widely reported by the media as in my case.
“None of these large borrowers (whose debt is significantly more than the KFA debt) have been declared wilful defaulters, but unfortunately, United Breweries Holdings and I have been declared willful defaulters by certain Banks on technical grounds. I have legally challenged these declarations.” He claimed that all “enquiries conducted have failed to find any evidence of misappropriation of funds by KFA or myself for the simple reason that the allegations and the innuendo to this effect is plainly false”.
“My Group directly invested over Rs 4,000 crore into KFA itself which investment stands fully impaired it is not as though it is only the bank debt that has suffered. The banks will recover a substantial part of their debt my groups loss is permanent,” he said.

Posted by on March 6, 2016. Filed under Economy. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.