Mallya gives $40m of Diageo payout to kids

Vijay Mallya has gifted $40 million of a $75m payout from Diageo to his children, as a consortium of 17 banks continues its efforts to recover more than a billion dollars of debt relating to Mallya’s now defunct Kingfisher Airlines.

Vijay Mallya

As reported by India’s Livemint, the payments to his children were revealed in court following orders for the former United Spirits chairman to reveal complete details of his overseas assets.

Mallya left India for on 2 March after signing a deal with Diageo that agreed to pay him US$75 million for stepping down as chairman of United Spirits Ltd.

In an affidavit submitted before the court, he stated that $40m of that payout has already been transferred to his three children – Siddharth, Leena and Tanya Mallya. They are US citizens and sole beneficiaries of the three trusts.

Mallya had been directed by the court in April to disclose all the assets held by him and his family, with a consortium of 17 banks led by the State Bank of India, seeking recovery of over Rs 9,000 crore in debts accrued by the now-defunct Kingfisher Airlines.

The billionaire was declared a wilful defaulter by the United Bank of India and later by the State Bank of India, a label Mallya challenges.

The IDBI is one of 17 Indian banks seeking to recover more than US$1 billion from Mallya. Last month they rejected his proposed scheme to repay $600 million.

Kingfisher Airlines, which was never profitable, collapsed into bankruptcy in 2012 with debts approaching £1bn.

Last week, the Karnataka high court ordered the winding up of Kingfisher Airlines Ltd.

The matter will next be heard next on 15 December.