United Breweries Ltd has asked Vijay Mallya to step down as its non-executive chairman after the Securities and Exchange Board of India barred the beleaguered liquor baron from holding directorship in any listed company.
The decision was taken at a board meeting on Wednesday, the maker of Kingfisher beer said in a stock-exchange filing.
The company, which counts Dutch brewer Heineken as its largest shareholder, took the decision after the BSE sought status of compliance with the SEBI order passed last month.
The capital markets regulator had restrained Mallya and six former executives of United Spirits Ltd from holding directorship in any listed company. It had also banned Mallya and six others from securities markets in a case related to illegal fund diversion.
The once-flamboyant businessman fled to London last year after banks sought to recover more than $1 billion in loans that Mallya’s now-grounded Kingfisher Airlines owes them.
The embattled businessman had stepped down from the board of United Spirits after a tussle with the UK-based Diageo Plc in February last year. The boardroom battle came after Diageo initiated an investigation into United Spirits's financial dealings with various UB Group companies, including United Breweries Holdings and Kingfisher Airlines.
United Breweries houses a clutch of brands including the flagship Kingfisher, Kalyani Black Label, Zingaro, Guru and Bullet.
Heineken had increased its stake in United Breweries by acquiring an additional 0.7% through an open market transaction last year, firming up its grip over the company. It now owns a 43.7% stake in United Breweries.
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