Banks Recover Nearly 60% of Vijay Mallya's Outstanding Debt

Strategic Insights -

Indian banks, led by the State Bank of India, have made significant progress in recovering dues from fugitive businessman Vijay Mallya. As of now, they have recovered nearly 60% of the nearly 9,900 crore rupees owed by Mallya, whose companies, including Kingfisher Airlines, owed banks nearly 9,900 crore in unpaid loans and accrued interests. The lenders have sold Mallya's shares worth 5,825 crore in United Breweries Ltd (UBL) to Heineken International BV, increasing Heineken's shareholding to 61.5% in UBL, the owner of India's largest-selling Kingfisher beer brand.

Key Takeaways:

  • Banks have recovered nearly 60% of the 9,900 crore rupees owed by Vijay Mallya, a fugitive businessman, through the sale of his shares in United Breweries Ltd (UBL).
  • The lenders, led by the State Bank of India, sold 14.99% of UBL's shares to Heineken International BV for 5,825 crore rupees, increasing Heineken's shareholding to 61.5% in the company.
  • The Enforcement Directorate (ED) has attached assets worth 18,170 crore rupees, or 80.45% of the alleged total loss to banks, under anti-money laundering law, with a part of these assets transferred to the banks and the central government.
  • Public sector banks have already recovered 1,357 crore rupees by selling shares of fugitive businessmen, with a total of 9,041.5 crore rupees expected to be realized by banks through the sale of attached assets.
  • The ED has booked fugitive businessmen Vijay Mallya, Nirav Modi, and Mehul Choksi for allegedly cheating banks of 22,586 crore rupees through their companies, with allegations of using dummy entities to rotate and siphon off funds.

Statistics:

  • 60% of 9,900 crore rupees recovered by banks from Vijay Mallya (as of now).
  • 5,825 crore rupees worth of shares sold by lenders in United Breweries Ltd (UBL) to Heineken International BV.
  • 14.99% of United Breweries Ltd (UBL) shares sold through a block deal on the stock exchanges.
  • 61.5% of United Breweries Ltd (UBL) shareholding now held by Heineken International BV.
  • 18,170 crore rupees worth of assets attached by the Enforcement Directorate under anti-money laundering law.
  • 80.45% of alleged total loss to banks attached by the Enforcement Directorate.
  • 1,357 crore rupees recovered by public sector banks by selling shares of fugitive businessmen.
  • 9,041.5 crore rupees expected to be realized by banks through the sale of attached assets.

Sources:

  • "Banks recover nearly 60% of Vijay Mallya's outstanding debt." Legal Monitor Worldwide. 2021.
  • "Enforcement Directorate attaches assets worth Rs 18,170 cr, expected to recover Rs 9,041.5 cr". The Economic Times.
  • "Mallya's extradition to India almost final, says Enforcement Directorate". The Hindu Businessline.