In a development that brings relief for both parties, the Supreme Court on Monday directed that ?status quo? be maintained in the sale of United Spirits to British group Diageo until April, when it would hear the matter again.
The Karnataka High Court had on December 20 last year annulled the sale of 6.9% stake in USL to Diageo while hearing a winding up petition against United Breweries (Holdings) (UBHL), the holding company of Vijay Mallya?s UB Group.
While issuing a notice to United Spirits, Diageo and other creditors, including the SBI-led consortium of creditors, a bench headed by Justice AK Patnaik directed to maintain status quo with regard to the transaction till April, when it would hear the seven appeals at length.
It said the issues related to the jurisdiction of the company court and the valuation of USL shares required to be heard in detail.
However, it clarified that the winding-up proceedings initiated by the financial entities, including one by BNP Paribas, in the HC would continue.
Senior counsel Mukul Rohtagi, appearing for Diageo, argued it was an open transaction and had received approvals from the RBI, market regulator Sebi and the Competition Commission of India. ?It was an open transaction and everyone was aware of it. Diageo completed its takeover in July, almost eight months after the companies announced the deal… the valuation of the shares at R1,440 was also transparent. Even the banks had given the NoC for the deal,? he said.