The minority shareholders of United Spirits Ltd (USL) have yet again defeated a series of resolutions that had been approved by the company’s board in the past, several of them concerning agreements between the liquor company and entities linked to Vijay Mallya’s UB Group. As many as nine out of 12 proposals that had been placed before shareholders as special resolutions at an extraordinary general meeting on Friday have not been approved with the requisite majority.
The key resolutions that were defeated in the vote include a R1,337.42-crore loan agreement with Mallya’s holding company United Breweries Holdings Ltd (UBHL), a R33.14-crore property purchase agreement with UBHL, advertising agreements with Mallya’s Formula One team, sponsorship agreements with the football team Mohun Bagan and racing team United Racing & Bloodstock Breeders.
The loan agreement pertains to various pre-existing loans, advances and deposits prior to Diageo’s acquisition of the liquor company which have been consolidated into an unsecured loan. The promoter group had recused from voting on all the resolutions since they were related party transactions.
A day earlier, USL said its special resolution for an exclusive manufacturing and licensing tie-up with parent Diageo failed to get the requisite majority in a postal ballot.