Kingfizzer: The Rise & Fall of Vijay Mallya, a just released book on Vijay Mallya argues that it will not be easy to extradite the fugitive from London and speculates whether he would seek citizenship of UK and stay back.
The book by well- known journalist Kingshuk Nag outlines the chain of events before Mallya decamped on March 1st, 2016 on a diplomatic passport.
Mallya’s sudden exit was propelled by information which he garnered that the previous day (February 28th ) that a senior counsel of Supreme Court Dushyant Dave had advised the State Bank of India to approach the apex court to restrain the liquor baron from leaving the country.
The secret advice possibly got leaked to Mallya immediately and he made himself scarce accordingly. What is interesting, a lookout notice for Mallya was issued by the CBI (Central Bureau of Investigation) to the Bureau Of immigrations on October 16th 2015.
This would have led to his detention the moment he presented himself at any immigration counter. But barely a month later, on November 24th 2015, the notice was amended.
By this, immigration authorities were merely to inform the CBI authorities about his movements. Incidentally, he arrived in India from an overseas trip on the night of November
24 th a few hours after the CBI amended this notice.
By this time, it was common knowledge that Mallya owed a huge amount (interest plus capital of Rs 9000 crore) to banks. But Mallya was busy negotiating for new business abroad. In January 2016, he was in Barbados in the West Indies negotiating the purchase of a cricket team for the Caribbean T20 Cricket League.
He met the Prime Minister of Barbados and won the Barbados Tridents Team which he claimed that he had procured for a mere $US 100, the new book says.
He also revealed that it would take $ 100 million annually to run the team. When asked how he would get that kind of money, Mallya said that the government of Barbados would help.
Incidentally on February 25 th 2016, less than a week before he fled the country Mallya had got a huge severance package from United Spirits Limited (USL) in lieu of relinquishing the chairmanship of the company.
Instead of using this amount to square bank dues Mallya transferred this amount ($ 40 million that was paid upfront) to a trust abroad which was held by his children. Later as a result of a special audit, Diageo the new owners of USL found out Rs 1221 crore had been transferred away from the company during Mallya’s time.
Kingfizzer argues that had government agencies acted earlier with the same zeal as they are showing now, Mallya could have been brought to justice earlier and he could not have escaped the dragnet of law. But the banks whom he owed money dilly dallied and did not register offences against Mallya and his companies with the investigating agencies.
This delayed the process of law and ultimately CBI suo motu filed a FIR against Vijay Mallya. Later on the matter was referred to the Enforcement Directorate (ED) to investigate possible money laundering.
In June 2017, ED has filed a 5000-page charge sheet against Mallya and other accusing him of diverting loans of Rs 900 crore given by IDBI Bank to Kingfisher Airlines to other entities including personal use. Five bank officials have also been charged.
The book, which traces the history of the Mallya Empire from the time of Vijay Mallya’s father Vittal Mallya also explores the personality and psyche of Vijay Mallya to figure out his penchant for the high life, which included wine, women and lavish properties across the globe.
Whereas father Vittal was very conservative and virtually a miser who kept track of every rupee, son Vijay was the exact opposite. The book argues that Vijay’s style was probably a manifestation of rebellious behavior against the father.
Vittal Mallya had married again and stayed in Bangalore whereas Vijay used to stay in Calcutta with his mother. Although materially affluent, Vijay missed the company of his father and thought that he did not get ‘enough of him.’
Though ultimately the Mallya Empire devolved on him, Vittal made it a point to tell Vijay many times in his school days that he could not assume that he would inherit the business.
Kingfizzer points out that Vijay Mallya was one of the first businessmen to take advantage of liberalization as he realized that global competition would sweep the shores of India. He ramped up capacities in the liquor industry through mergers and amalgamations.
At first, he consolidated capacities in India and thereafter focused attention abroad. He was successful in creating a global brand out of Kingfisher beer and buoyed by this success and his growing ambitions chose the name for floating an airline.
But Kingfisher Airlines was the harbinger of his bad luck as Mallya could not fathom the aviation market. Although it would have made inherent sense to float a low-cost carrier which would enable rail passengers to upgrade to flying, Mallya did just the opposite.
Although the service on Kingfisher Airlines was good, the high-cost model doomed Mallya. He acquired a low-cost airline: Deccan Airways but instead of propelling it, Mallya killed it.
He had only bought the airline (Deccan Airways which began in 2003 and was two years older than Kingfisher Airlines) to fulfill the requirement of five years that was
necessary for an airline to fly overseas.
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The global downturn in 2008-09 and escalating fuel costs brought down Kingfisher Airlines to the knees. But instead of changing track, and lowering costs, Mallya blamed external factors for his misfortunes.
Mallya had a jet for his exclusive use and this was stylishly fitted with an original Picasso painting. Mallya being an MP had tremendous clout.
He was also a member of the Consultative Committee of Parliament for the civil aviation ministry. This gave him a vantage position to watch policy making for a sector of which he was a player.
Although earlier he had the reputation of paying his employees well, with the crash landing of Kingfisher he left many employees with unpaid dues.
Mallya while negotiating his exit out of United Spirits Limited with the new owners Diageo entered into a none- compete clause that bars Mallya from doing liquor business in the world except Great Britain.