1. Vijay Mallya: Forced to live in exile, wish to settle debt with banks

Vijay Mallya: Forced to live in exile, wish to settle debt with banks

Vijay Mallya wants a "reasonable" settlement with creditor banks to his defunct airline, he said in an interview in London published by the Financial Times on Friday.

By: | New York | Updated: April 29, 2016 1:08 PM
vijay mallya Vijay Mallya, 60, flew first class from Delhi to London on March 2 at a time when public sector banks are trying to recover .4 billion (Reuters)

Embattled tycoon Vijay Mallya wants a “reasonable” settlement with creditor banks to his defunct airline, he said in an interview in London published by the Financial Times on Friday.

Mallya, 60, flew first class from Delhi to London on March 2 at a time when the government and mainly public sector banks are trying to recover $1.4 billion owed by his collapsed Kingfisher Airlines Ltd.

“We have always been in dialogue with banks saying: ‘We wish to settle’. But we wish to settle at a reasonable number that we can afford and banks can justify on the basis of settlements done before,” Mallya told the newspaper in London.

“By taking my passport or arresting me, they are not getting any money,” the newspaper quoted him as saying.

Mallya said he was in “forced exile” and had no plans to leave Britain.

The central government wrote to its British counterpart on Thursday seeking the deportation of the liquor tycoon and Formula 1 motor racing boss, who is the target of a non-bailable warrant in a money laundering investigation.

He denied wrongdoing.

“I am absolutely not guilty of any of these preposterous charges of diverting funds from Kingfisher, buying properties or stuff like that,” Mallya told the Financial Times.

An India-based spokesman for Mallya’s UB Group said he had no further comment to make when contacted by Reuters.

The Enforcement Directorate, a government agency set up to fight financial crime, has accused Mallya of using Rs 430 crore ($64.5 million) of bank loans to Kingfisher to buy property overseas. In the present case, the ED had alleged that Mallya had violated the provisions of Foreign Exchange Regulation Act (FERA) in arranging funds to advertise his company’s liquor products abroad.

ED had claimed that Mallya was summoned on four occasions for questioning in connection with a contract signed in December 1995 with London-based firm Benetton Formula Ltd for promotion of the Kingfisher brand abroad.

When Mallya failed to appear before ED in response to the summons, a complaint was filed on March 8, 2000 before a court here and later on charge was framed against him under section 56 of FERA.

According to ED, Mallya had allegedly paid 200,000 dollars to the British firm for displaying Kingfisher logo in Formula One World Championships in London and some European countries in 1996, 1997 and 1998.

The agency had claimed that the money was allegedly paid without prior approval from RBI in violation of FERA norms.

Creditors, led by State Bank of India, have rejected an offer of partial repayment by Mallya, who had given a personal guarantee for the Kingfisher loan. They have demanded that the former billionaire attend a hearing in the Supreme Court.

In its annual report for 2012-13, KFA said at its peak it was the largest airline in India, with a five-star rating from Skytrax.

Tags: Vijay Mallya
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