Mallya case: Banks to file objections to Heineken’s impleadment plea

By: | Published: June 22, 2016 12:26 AM

"We will file objections to Heineken's application seeking impleadment in Vijay Mallya case, tomorrow," SBI Senior Counsel Nagananda submitted before DRT Presiding Officer C R Benakanahalli.

Heineken on June 18 had sought permission to implead itself in the case and enjoy the right of first refusal over the UBL shares. (Reuters)Heineken on June 18 had sought permission to implead itself in the case and enjoy the right of first refusal over the UBL shares. (Reuters)

The Consortium of Banks led by SBI today said it would be filing objections to the Dutch beer major Heineken’s application before the Debt Recovery Tribunal seeking to be impleaded in the Vijay Mallya case.

“We will file objections to Heineken’s application seeking impleadment in Vijay Mallya case, tomorrow,” SBI Senior Counsel Nagananda submitted before DRT Presiding Officer C R Benakanahalli.

Heineken on June 18 had sought permission to implead itself in the case and enjoy the right of first refusal over the UBL shares.

Heineken has some presumptive rights on UBL shares held and owned by Mallya.

Right of first refusal is a contractual term between shareholders which are usually included in the Articles of Association.

If one shareholder wishes to dispose of shares that are subject to a right of first refusal (ROFR), it must first offer them to those other shareholders who have the benefit of ROFR.

Earlier, IDBI Bank pleaded to sustain its August 2015 order relating to attachment of 34 lakh equity shares of United Spirits Limited in the case, since Vijay Mallya’s resortment to asset stripping has resulted in eroding of his networth.

“The Bank hereby makes an humble submission to sustain attachment of 34 lakh equity shares of United Spirits Limited, since Mallya has resorted to asset stripping by resigning from every company, which has resulted in eroding of his net worth,” IDBI Bank Counsel N V Srinivasan said.

Srinivasan also submitted that the eroding of his net worth is a violation of agreement between Kingfisher Airlines Limited and IDBI, because the former has to maintain its personal guarantor net worth.

Moreover, Kingfisher could avail loans because of Mallya’s net worth in addition to other securities, Srinivasan submitted.

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