Mumbai, Feb 25: Liquor magnate Vijay Mallya has agreed to resign from the position of Chairman and Non-Executive Director of United Spirits Ltd., the local division of Britain Diageo Plc. Vijay Mallya sold most of his shares in United Spirits – the largest spirits company of India, which was a part of his UB Group and gave the management control to Diageo in 2012.
In 2015 April, the United Spirits board had started a method to remove Mr Mallya as the company’s chairman due to assumed financial irregularities. Mr Mallya had then denied the claims as well as had refused to resign from his post.
In 2015 April, the United Spirits board had started a method to remove Mr Mallya as the company’s chairman due to assumed financial irregularities. Mr Mallya had then denied the claims as well as had refused to resign from his post.
“The time has now come for me to remove on and end all the publicized allegations and uncertainties about my relationship with Diageo and United Spirits Limited,” Mr Mallya said in a statement issued on Thursday.
“Accordingly, I am resigning my position with immediate effect.”
Mahendra Kumar Sharma, an independent director and former vice-chairman of Hindustan Unilever, will replace Mallya.
“Accordingly, I am resigning my position with immediate effect.”
Mahendra Kumar Sharma, an independent director and former vice-chairman of Hindustan Unilever, will replace Mallya.
“Vijay Mallya no longer has any authority or responsibility within USL Group. It also allows USL to extract right value of USL assets and helps in maintaining banking relationships,” Abanti Sankaranarayanan, business head (luxury and corporate relations) at USL, said in a conference call. “USL will give $75 million to Mallya in consideration for his five-year noncompete agreement and an undertaking that he will not buy any shares of USL for the next five years. The first-year payment would be $40 million.”
The USL Company said the settlement brings to an end the doubt surrounding the company’s authority as well the uncertainty relating to certain transactions that were voted down by the company’s shareholders in November 2014. The payment puts in place a global five-year non-compete, non-interference and get weaker arrangement with Mallya.
“This
is a murder of corporate governance and a company can’t run on the whims and
fancies of an individual. You can settle a personal dispute and not a corporate
one like this. All throughout, Diageo was alleging charges on Mallya. Now the
company should either admit they were wrong or explain why there was a need to
pay money. This even makes the shareholder kind of a non-entity,” said JN
Gupta, founder of Stakeholders Empowerment Services — a proxy advisory
services and corporate governance research enterprise.
Mumbai, Feb 25: Liquor magnate Vijay Mallya has agreed to resign from the position of Chairman and Non-Executive Director of United Spirits Ltd., the local division of Britain Diageo Plc. Vijay Mallya sold most of his shares in United Spirits – the largest spirits company of India, which was a part of his UB Group and gave the management control to Diageo in 2012.
In 2015 April, the United Spirits board had started a method to remove Mr Mallya as the company’s chairman due to assumed financial irregularities. Mr Mallya had then denied the claims as well as had refused to resign from his post.
“The time has now come for me to remove on and end all the publicized allegations and uncertainties about my relationship with Diageo and United Spirits Limited,” Mr Mallya said in a statement issued on Thursday.
“Accordingly, I am resigning my position with immediate effect.”
Mahendra Kumar Sharma, an independent director and former vice-chairman of Hindustan Unilever, will replace Mallya.
“Vijay Mallya no longer has any authority or responsibility within USL Group. It also allows USL to extract right value of USL assets and helps in maintaining banking relationships,” Abanti Sankaranarayanan, business head (luxury and corporate relations) at USL, said in a conference call. “USL will give $75 million to Mallya in consideration for his five-year noncompete agreement and an undertaking that he will not buy any shares of USL for the next five years. The first-year payment would be $40 million.”
The USL Company said the settlement brings to an end the doubt surrounding the company’s authority as well the uncertainty relating to certain transactions that were voted down by the company’s shareholders in November 2014. The payment puts in place a global five-year non-compete, non-interference and get weaker arrangement with Mallya.
In 2015 April, the United Spirits board had started a method to remove Mr Mallya as the company’s chairman due to assumed financial irregularities. Mr Mallya had then denied the claims as well as had refused to resign from his post.
“The time has now come for me to remove on and end all the publicized allegations and uncertainties about my relationship with Diageo and United Spirits Limited,” Mr Mallya said in a statement issued on Thursday.
“Accordingly, I am resigning my position with immediate effect.”
Mahendra Kumar Sharma, an independent director and former vice-chairman of Hindustan Unilever, will replace Mallya.
“Vijay Mallya no longer has any authority or responsibility within USL Group. It also allows USL to extract right value of USL assets and helps in maintaining banking relationships,” Abanti Sankaranarayanan, business head (luxury and corporate relations) at USL, said in a conference call. “USL will give $75 million to Mallya in consideration for his five-year noncompete agreement and an undertaking that he will not buy any shares of USL for the next five years. The first-year payment would be $40 million.”
The USL Company said the settlement brings to an end the doubt surrounding the company’s authority as well the uncertainty relating to certain transactions that were voted down by the company’s shareholders in November 2014. The payment puts in place a global five-year non-compete, non-interference and get weaker arrangement with Mallya.
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