Ritu Mallya, 69, the stepmother of Vijay Mallya, has joined the board of Mangalore Chemicals and Fertilizers.
Vijay had to quit the board of MCF on Monday after banks advised the company it would be difficult for them to lend money to it with a “wilful defaulter” on board. Ritu Mallya is a Bengaluru-based lawyer and was married to late Vittal Mallya, the founder of the
UB group. Ritu, whose maiden name was Kailash Advani, ran a garments business at the time of her marriage to Vittal.
“The board of directors, under the articles of association, is authorised to appoint a director. Ritu Mallya has also given her consent for her appointment as director. She will continue to be director until the company’s next annual general meeting where the shareholders’ approval will be sought,” an MCF official said.
The company is in the middle of a takeover battle between Pune-based Deepak Fertilisers and Kolkata-based Adventz group.
Vijay’s resignation came after State Bank of India sent a communication to all companies where UB Group Chairman Vijay Mallya was a director, saying it would be difficult for the banks to lend fresh funds to the companies with the presence of a “wilful defaulter” on board.
This means Vijay, on the board of United Breweries and UBHL, will have to resign in the near future if these companies want to access bank funds.
Confirming a missive to various companies where Vijay was on board, a top State Bank of India official said this was not isolated action and was part of lenders’ action after the now-grounded Kingfisher Airlines defaulted on payments on dues worth Rs 7,000 crore.
Banks have been active in using legal forums for over a year and this step — sounding caution to companies where Vijay Mallya is on board — has been initiated in the past few months. Lenders would take adverse view of his presence on any board, the SBI official told Business Standard.