THE GOOD TIMES TURNED 'SOUR'



“Has The King of Good Times lost his Midas touch?”
At age 28 Vijay took control of United Breweries Ltd (UB Group) on the demise of his father Vittal Mallya, who lost his life to heart attack in 1983. A man of high ambition Mallya went on an acquisition spree which included Berger Paints (which was later sold off); Best and Crompton (an engineering film in 1988); Mangalore Chemicals and Fertilisers (called Malabar Chemicals and Fertilisers in 1990).
The UB Group which owns some of the biggest Indian alcohol brands, like Royal Challenge, controls 40% of Indian-made foreign liquor (IMFL) acquired companies like Whyte and Mackay and Liquidity Inc which turned Vijay Mallya into a billionaire. UB Group has extended its wings in sports as they entered a joint venture with the Kolkata-based Mohun Bagan football club in 1998. In the same year, the company picked up stake in another club, the Kingfisher East Bengal Football Club. Mallya went on to buy Spyker Ferrari formula one team, for about 90 million Euros. The next year, he bought the Indian Premier League cricket team, Royal Challengers Bangalore, for $111.6 million.
Vijay Mallya’s inherited his business acumen from his father Vittal, who after sensing opportunity in UB Group (which was started by Thomas Leishman, a Scotsman in Chennai in 1915) kept buying its shares and in 1947 got elected to the company’s board. And at the age of 22 became its chairman. From there Vittal diversified into pharmaceuticals and food.
In 2005, Vijay Mallya entered into aviation sector with Kingfisher Airlines, actually Kingfisher Airlines completely symbolizes Vijay Mallya; fast cars and beautiful women; so much so that the budding entrepreneur and youngest wanted to emulate him as Vijay Mallya presented a fashionable and stylish Indian look. Furthermore who would not be swayed by a fleet of 200 luxury vintage cars, a 95m “mega yacht” with a helipad, a Gulfstream private jet along with dishing out millions at various auctions across the globe for vintage items like the a Tipu Sultan sword. It is no wonder that he was termed as the “Indian Richard Branson”
But the only constant about life is change. Trouble stated in 2012 when Kingfisher Airlines was grounded for non-payment of its staff; it was later revealed that the airlines did not make any profit after its launch in 2005. The final nail on the coffin was Kingfisher’s acquisition of Air Deccan in 2007, which resulted in huge debt for the company which resulted in its closer.
Bad times doesn’t comes alone they flow in waves, in October 2014; Mallya got into a battle for the controlling stake in the Rs3, 700 crore ($586 million) Mangalore Chemicals and Fertilisers. After a string of legal battles, including an attempt to seize some of the cash raised by the liquor baron’s sale of his spirits business, United Spirits, to Diageo, Mallya’s luck seems to run out as United Spirits logo nets loss of Rs. 1,799 crore in the first three months March 2015.
But Mallya remained steadfast and refused to budge, he has a valid contractual agreement with Diageo, which directly addresses his position as USL’s director and chairman. “I will discuss this bilaterally with Diageo PLC and not in the public domain,” he said.
World largest liquor firm Diageo has asked UB Group chairman Vijay Mallya to step down from the board of USL (United Spirit) citing ‘lost confidence’ after uncovering financial irregularities and legal violation at the company; the ministry of corporate affair (MCA) and the income tax (I-T) have also begun separate probes of USL. The bad news doesn’t end here for Mr Mallya as banks are also not happy with his behavior with United Bank of India coming out and taking a strong stance declaring Kingfisher and Mallya as a “wilful defaulter” This statement is never flattering even if you are The King of Good Times himself.

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