Bangalore, July 10 () : Vijay Mallya, the flamboyant tycoon was caught napping when Deepak Fertilizers made a hostile takeover by acquiring a 24.46 % share in Mangalore Chemicals and Fertilizers.
Mallaya has only 22% in his company. Diageo which acquired stake in United Spirits has changed everybody at the helm, leaving Vijay Mallaya as the non-executive Chairman. With his companies going out of his control, Vijay Mallya is left with only his racing horses, formula car racing team and an IPL team.
Mallya had everything going for him. His brewery business was India’s number one. His brands like Kingfisher beer was guzzled by Indians. He promoted his companies and brands along with himself as `King of Good Times’. His Kingfisher calendar and bikini babes were the talk of the town. The cheerleaders of his IPL team were the best.
He started Kingfisher Airlines in style. Pretty looking red uniformed girls, plush interiors and good food made the airlines a best bet to travel. Even though Vijay Mallya travelled in his own private jet, he and his son Siddharth (who got the airline as a birthday gift) saw that the airlines maintained its class. Within a year the account books showed that it had been burning a hole in the pocket.
Meanwhile, Mallya bought the low-cost Deccan aviation and added it to the fleet. He leased out planes from abroad. His pay packet was the best in the aviation industry.
The losses kept mounting and finally the stage came where it could neither get fuel on credit nor be able to pay the salary. The airlines was finally grounded. Those who leased the aircraft want to take it back but cannot due to DGCA rules.
Mallya even now claims that the airline will fly. By then he had sold many assets to keep his airline flying. Banks have invoked the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act by which they get the right to take over the assets that are mortgaged with them and sell it to recover their dues.
At this juncture, Deepak Fertilizers in Pune acquired 24.46 % share in Mangalore Chemicals and Fertilisers. Mallya could not fight by increasing his stake since he is supposed to be broke. If Deepak Fertilizers gets to have 25%, then it would be able buy 20% from other shareholders. The timing was perfect as Mangalore Chemicals is about to receive natural gas for its plant. The profit of the company is Rs 102 crore and its revenue stands at Rs 3,700 crore. The market value is Rs 650 crore.