Companies

PNB declares United Breweries Holdings as ‘wilful defaulter’

Our Bureau | | Updated on: Jan 19, 2018

mallya

United Breweries (Holdings) Ltd has informed BSE that Punjab National Bank has declared the company as a ‘willful defaulter’.

Vijay Mallya-owned holding company is in consultation with its legal counsels to challenge the decision, the statement said. State Bank of India too had declared Mallya, Kingfisher Airlines and UB Holdings as willful defaullters for defaults on loans worth Rs 7,000 crore.

PTI reports:

Punjab National Bank vide letter dated February 11, has declared the company a “willful defaulter”, United United Breweries Holdings Ltd (UBHL) said in a BSE filing, adding it received the letter on Monday.

On its future course of action, UBHL said: “The company is in consultation with its legal counsels to challenge the decision by taking appropriate legal action that may be required in this regard.”

In November, State Bank of India had declared Mallya, Kingfisher Airlines and its holding company United Breweries Holdings as wilful defaulters.

A bank consortium led by SBI has decided to auction Kingfisher House in Mumbai on March 17 this year in a bid to recover a part of Rs 6,963-crore debt due from Kingfisher Airlines.

Punjab National Bank had an exposure of Rs 800 crore to the defunct carrier.

The airline, owned by flamboyant liquor baron Mallya, had taken Rs 6,900 crore from a consortium of 17 lenders led by SBI in early 2010 after a second debt restructuring for the airline. The lenders had claimed that United Breweries (Holdings) Ltd and Vijay Mallya were guarantors to the loans.

SBI has an exposure of Rs 1,600 crore to the airline.

Out of this, the bankers, which recalled the loan in February 2013, could recover only around Rs 1,100 crore after selling the pledged shares of UB Group companies.

Other banks that have exposure to the airline include Punjab National Bank and IDBI Bank (Rs 800 crore each), Bank of India (Rs 650 crore), Bank of Baroda (Rs 550 crore), and Central Bank of India (Rs 410 crore).

UCO Bank has to recover Rs 320 crore, Corporation Bank (Rs 310 crore), State Bank of Mysore (Rs 150 crore), Indian Overseas Bank (Rs 140 crore), Federal Bank (Rs 90 crore), Punjab & Sind Bank (Rs 60 crore) and Axis Bank (Rs 50 crore).

Shares of United Breweries Holdings Ltd were trading at Rs 20.85 in mid-day trade, down 8.15 per cent from the previous close on BSE.

Correction

This news report has been modified to correct the figure on loan defaults to Rs 7,000 crore, from Rs 7,000, as a previous version stated.

Published on February 16, 2016
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