Vijay Mallya?s UB Group and his old rival Kishore Rajaram Chhabria on Tuesday filed consent terms in the Calcutta High Court to bring to end a long-drawn battle which started with Mallya?s takeover of Shaw Wallace in 2005. The move to close 30 cases on both sides comes as Mallya is talking to Diageo to sell a stake in his flagship company United Spirits.

For Mallya, this is one impediment out of the way before he possibly consummates the deal with Diageo. Meanwhile, Chhabria?s Allied Blenders & Distillers will finally get undisputed ownership of Officers Choice, its largest selling whiskey, a product which Mallya had laid claim to. ABD told FE that now it could concentrate on brand building and raise fresh capital.

Late last year, Mallya had moved the Calcutta HC seeking to restrain ABD from raising capital until the ownership dispute was settled.

The United Spirits scrip closed at R1,260.70, up by 6.67% on the BSE on Tuesday. This, as the benchmark Sensex rose 0.45% or 84.38 points to close at 18,793.36 points.

ABD chief executive Deepak Roy told FE that the settlement was signed between the two groups on Monday. ?The consent terms were filed in the court on Tuesday,? he said. ?It was just unnecessarily de-focussing us from day-to-day operations. It?s not good to be wasting resources.? To settle the matter, ABD will be paying Mallya?s USL Rs 8 crore. ?It clears all the (legal) impediments that could have come. I?m sure potential investors would have also been concerned,? Roy said. ?It was a casual talk in August that started this process.? he added.

United Spirits (USL) had taken birth in 2006 with the merger of Shaw Wallace?s assets into UB-owned McDowell & Co. The dispute arose after Mallya took over Shaw Wallace, owned by Kishore Chhabria?s late brother Manu. Mallya then opposed the fact that Kishore Chhabria wanted to keep Officer?s Choice with him. USL then sought to substitute itself as the plaintiff in place of Shaw Wallace in a suit filed in 1992. Now that the two parties want to settle the various cases pending in many judicial fora, the curtains have finally come down on the 20-year power battle.

Mumbai-based ABD now expects its sales to touch 21 million cases this fiscal, of which at least 85% will come from sales of Officer?s Choice. The company is also looking to build a distillery and bottling unit in Andhra Pradesh which at an investment of Rs 200-300 crore, said Roy. ?Very clearly, there are 2-3 things we (ABD) need to do; build distillation and bottling capacity to keep up the growth rate. We are too dependent on one brand and now need to start building the other brands,? said Roy.

A statement from ABD quoting KR Chhabria said that though he was confident that these lawsuits held no risk for either Officers Choice or the company, with the settlement in place, he will be free from all legal activities. ?With the withdrawal of these lawsuits, most of which was instituted as a consequence of a dispute within the Chhabria family, it brings to an end a 20-year old dispute between the KRC group of companies and erstwhile Shaw Wallace group of companies which is now part of Vijay Mallya controlled United Spirits Ltd,? Chhabria said.

A UB Group spokesman declined comment on the development.

Mallya?s talks with Diageo are being seen as an attempt to unlock value from group assets to save his floundering airline. However, it is still unclear whether Mallya can channel the proceeds into Kingfisher Airlines or retire debt the over Rs 8,000-crore debt on USL?s books. Analysts see Tuesday?s developments as Mallya getting closer to a deal with Diageo. USL sold 120 million cases in FY12 in India in a market which saw sales of 295 million cases.