Banks to file objections to Heineken's impleadment plea

The Consortium of Banks led by SBI today said it would be filing objections to the Dutch beer major Heineken's application before the Debt Recovery Tribunal seeking to be impleaded in the Vijay Mallya case.
"We will file objections to Heineken's application seeking impleadment in Vijay Mallya case, tomorrow," SBI Senior Counsel Nagananda submitted before DRT Presiding Officer C R Benakanahalli.
Heineken on June 18 had sought permission to implead itself in the case and enjoy the right of first refusal over the UBL shares.
Heineken has some presumptive rights on UBL shares held and owned by Mallya.
Right of first refusal is a contractual term between shareholders which are usually included in the Articles of Association.

If one shareholder wishes to dispose of shares that are subject to a right of first refusal (ROFR), it must first offer them to those other shareholders who have the benefit of ROFR.

Earlier, IDBI Bank pleaded to sustain its August 2015 order relating to attachment of 34 lakh equity shares of United Spirits Limited in the case, since Vijay Mallya's resortment to asset stripping has resulted in eroding of his networth.
"The Bank hereby makes an humble submission to sustain attachment of 34 lakh equity shares of United Spirits Limited, since Mallya has resorted to asset strippingby resigning from every company, which has resulted in eroding of his net worth," IDBI Bank Counsel N V Srinivasan said.

Srinivasan also submitted that the eroding of his net worth is a violation of agreement between Kingfisher Airlines Limited and IDBI, because the former has to maintain its personal guarantor net worth.
(REOPENS MDS7)
Sreenivasan also observed that the banks have not even stated with reasonable proof that Airbus was in any financial distress to justify passing an additional order against them.
"Taking into consideration of the above issues, I am of the view that the interest of the applicants (banks) will be protected if the prayers and reliefs claimed by them in the present applicants are molded and modified so as to bind only the third defendant (Airbus) as party and not any innocent third parties," he said.

"Such an order will be binding on the third defendant (Airbus), at least for the present, subject to the orders of DRAT. This I think will serve the parties and will be sufficient to safeguard the banks' claim made in the OA," he added.
"I therefore propose to mould and modify the relief prayed for by the banks," Sreenivasan said.
Kingfisher Airlines owes over Rs 9,000 crore to the SBI-led consortium of 17 banks.
Mallya, who left the country on March 2 and is now in the UK, has been declared a proclaimed offender by a special PMLAcourt in Mumbai on a plea by the Enforcement Directorate inconnection with its money-laundering probe against him in the alleged bank loan default case.