Addendum
Debt laden Mallya absconds to Britain as creditors close in
May 1st 2016
Believed to be resident in a US$15 million mansion on the northern outskirts of London, V. J. Mallya, the playboy owner of bankrupt Indian carrier, Kingfisher Airlines, has had his Indian passport revoked and been stripped of his membership of the indirectly elected Upper House of India’s national parliament. Read More »
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Under pressure from investigators and a 17-bank consortium to repay US$1.36 billion in loans allegedly used to operate the short lived premium carrier, Mallya slipped out of the country on March 2. Since then he has declined to return to India to answer government investigators’ questions about alleged corrupt practices at the defunct airline.
India’s Enforcement Directorate (ED), which is responsible for investigating financial crimes, has summoned Mallya three times for interviews about the airline’s unpaid loans. The flamboyant 60-year-old has ignored the summonses and stayed put in Hertfordshire.
Mallya, who inherited a drinks empire from his father, attempted to settle the case earlier this year by offering to repay US$650 million of the outstanding debt, but the lenders declined his terms.
During Kingfisher’s four-year life, Mallya supplemented the airline’s operations with funds from his liquor company, United Spirits. It was India’s biggest spirits company until Mallya was forced to sell a controlling share of it to global spirits conglomerate, Diageo, in 2014.
In February, investigators were furious to learn that Diageo had paid Mallya $75 million to resign as chairman of United Spirits. It is generally agreed the windfall payment intensified the lenders' determination to make Mallya pay. But he was too agile for them and used his diplomatic passport to depart the country.
This week it was reported that the Indian government had begun proceedings to deport Mallya from Britain,but so far he remains beyond its legal reach.
