Friday, June 18, 2021

SBI-led banks to sell Vijay Mallya’s shares worth Rs 6,200 crore next week to recover Kingfisher Airlines loan

A clutch of banks led by the country’s largest lender, State Bank of India (SBI), is preparing to sell fugitive businessman Vijay Mallya’s shareholdings in three companies on June 23 in a bid to recover as much as Rs 6,200 crore lent to his grounded Kingfisher Airlines.

The share sale is due to happen through bulk deals in the three firms, United Breweries Limited, United Spirits Limited and McDowell Holding Limited, according to documents reviewed by Moneycontrol.

Mallya’s airline Kingfisher was grounded on October 20, 2012, after it plunged into a financial crisis. Mallya was declared a fugitive economic offender in January 2019 for defaulting on loans and allegedly defrauding banks. He is fighting extradition to India in UK courts.

If the share sale happens, this will be the first instance of banks making a significant recovery in the Kingfisher-Vijay Mallya case since the loan turned NPA, or bad asset, in late 2012. Mallya left India on March 2, 2016, for the UK after defrauding 17 banks and has not returned since then. He owes Rs 9,000 crore to banks and the accrued interest amount.

According to the documents reviewed by Moneycontrol, the sale of shares will happen under the scrutiny of the Bengaluru Debt Recovery Tribunal (DRT), which has authorised the recovery officer for the sale of shares to recover “Rs 6,203 crore along with costs and interest at 11.5 per cent calculating from June 25, 2013, till the date of recovery”.

18/06/21 Tarun Sharma/Moneycontrol

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