The UK High Court has according to media reports have ordered liquor tycoon Vijay Mallya to pay in full USD 135 million to British beverages giant Diageo. The court made its judgment after hearing arguments in the case where Diageo claims Mallya owes them money.
Mallya lost the summary judgment to Diageo and now is bound to pay the full amount within 28 days.
A related claim of 40 million given directly to Mallya will also go to full trial. In total, a loan of 175 million dollars is to be repaid to Standard Chartered Bank against shares Diageo has not been able to access.
Justice Robin Knowles heard Diageo’s claim that Mallya, his son Sidhartha and two companies associated with the family are liable for repayment of the funds dating back to the company’s acquisition of a controlling stake in Mallya’s United Spirits Limited (USL) around three years ago.
Of the total amount claimed by the London-headquartered drinks firm, USD 40 million is claimed directly from Mallya as the amount paid to him as part of a disengagement agreement and the remaining amount from Sidhartha Mallya and Watson Limited, a company held in a Mallya family trust called the Continental Administration Services Limited (CASL).
“We are suing Dr Mallya for repayment and damages amounting to approximately USD 175 million. This is money Dr Mallya and some of his affiliate companies owe Diageo and we have always been clear that we are entitled to exercise our right to recover the sum in full,” said Dominic Redfearn, spokesperson for Diageo, one of the world’s largest distillers behind brands like Johnnie Walker and Smirnoff.
The three claimants in the case, Diageo Plc, Diageo Holdings Netherlands BV (DHN) and Diageo Finance Plc, are pursuing 63-year-old Mallya over an agreement struck in February 2016, under which he would step down as chair of United Spirits in exchange for a financial agreement.