Govt rejects Kingfisher Airlines' plea to re-appoint Vijay Mallya as CMD
PTI December 1, 2014
In a fresh blow to United Breweries Group chief Vijay Mallya, the government has rejected an application by Kingfisher Airlines to re-appoint him as Managing Director.
Kingfisher Airlines, the home-grown private carrier which had to be grounded in October 2012 due to severe financial crunch, had sought the approval of the Corporate Affairs Ministry for re-appointing Mallya for a five-year period beginning October 16, 2013 "without remuneration".
The airline has already faced actions by domestic bourses for non-compliance to listing agreement as it has failed to submit financial results for the past few quarters and to make other mandatory disclosures.
The company said in a regulatory filing that its application for re-appointing Mallya as MD has been rejected.
No specific reason could be immediately ascertained for the rejection.
The disclosure comes on a day, when another UB Group firm Mangalore Chemicals and Fertilizers announced Mallya's resignation as a director without giving any reason.
Besides, minority shareholders of United Spirits had last week rejected several proposals including those about dealings of the company with Mallya, whose group has sold controlling stake to British liquor giant Diageo.
The UB Group chairman is already engaged in legal tussle with several lenders who are trying to recover their loans amounting to thousands of crores of rupees from Kingfisher and some of them have also declared Mallya as a wilful defaulter.
UB Group has sold stakes in some other ventures as well including brewery business and a sports venture.
Kingfisher shares incidentally rose on Monday by about five per cent to Rs 1.34. The company currently commands a market value of about Rs 100 crore, as against a high of over Rs 10,000 crore before troubles began at the airline in late 2012.
Mallya is Chairman and Managing Director of Kingfisher Airlines, while it has been without a CEO ever since Sanjay Agarwal left the company in early 2014.
The private carrier is already under regulatory scanner for alleged accounting lapses.