Diageo-controlled United Spirits will see Vijay Mallya remain as its chairman

Diageo-controlled United Spirits will see Vijay Mallya remain as its chairman

Vijay Mallya has been re-elected as chairman of United Spirits at the AGM of the Diageo-controlled firm. 

In a statement today, Diageo, which took majority control of the Indian drinks firm in July, confirmed that Mallya will remain in the role, and as a non-executive director, of United Spirits. Under the UK group's original agreement with United Spirits' parent firm, Mallya's UB Group, it is contractually obliged to vote to keep the Indian entrepreneur as chairman.

As part of the agreement, the UB Group must continue to hold at least 1.3m shares in United Spirits and Mallya must continue to control the conglomerate. "Diageo's contractual obligations to support Dr Mallya continuing as non-executive director and chairman of USL are subject to these conditions as well as the absence of certain defaults by UBHL or Dr Mallya," the statement added.

Anand Kripalu will also remain as United Spirits' CEO, following the vote at yesterday's AGM. Diageo's former CEO, Paul Walsh, also retains his place on United Spirits' board as a non-executive director.

Last month, United Spirits reported that its full-year losses had widened to INR44.9bn (US$742.7m). The reporting of the results were delayed due to problems with debtors and outstanding loans. The company has launched an inquiry into the disputed loans, which were given to other companies within Mallya's UB Group. 

Mallya has reportedly rejected allegations by the United Bank of India that he is a “wilful defaulter” in relation to his debt-laden Kingfisher Airlines unit