British spirits group Diageo has expressed its intentions to pursue Indian businessman Vijay Mallya to recover an estimated $182 million in funds it said were diverted from Indian subsidiary, United Spirits.
In a weekend notice issued to the Bombay Stock Exchange, United Spirits said a detailed forensic investigation had revealed improper transactions in which Rs 12 billion were diverted to overseas and Indian entities connected to Mallya from 2010 to 2014, before Diageo took over the reins. Firms that received money in these transactions included Force One India and Kingfisher Airlines. In a press release, USL said the February agreement between Diageo and Mallya, that saw the king step down from the chairmanship of United Spirits in exchange for a $ 75 million payout did not preclude attempts to recover funds that were the subject of the just-concluded forensic probe.
"The USL Board has directed the management to pursue recovery from the relevant companies and individuals and undertake any action, including legal and regulatory as deemed necessary," the company said. Mallya, who is on a "self exile" in London, said he wasn't aware of the allegations or the inquiry. "I can only reiterate that all transactions were legal, above board and approved by USL Auditors, the USL Board and shareholders."
A businessman mostly known for his luxurious and extravagant lifestyle, Mallya is now the poster boy for the country's bad debt problem. The government currently looks to recover up to $1.3 billion he owes state banks and other creditors after his Kingfisher Airlines collapsed. He has ignored multiple summons from Indian anti-corruption investigators in New Delhi, since March.
