news Wednesday, July 08, 2015 - 05:30
The final frontier may have collapsed for Vijay Mallya as the Dutch beer giant Heineken is poised to take over United Breweries, the last big company in the Indian tycoon’s kitty. A report in The Times of India mentions that the Dutch company has raised its stake in UB to over 42% after buying some of its shares released by United Spirits on Tuesday. A top official with UB tells the newspaper that the latest share acquisition by Heineken freed them from “an earlier pact with Mallya based on equal shareholding and joint management.” In 2009, Mallya and Heineken had announced a partnership which stipulated shares worth 37.5% to each. Now, Mallya’s stake in the company has fallen to 32%. His recent financial difficulties have given the Dutch company a majority stake in a company which owns the Kingfisher brand and close to half of the domestic beer market.  Slowly and steadily, Heineken raised their stake in the company in the past two years and the earlier agreement which deemed that the partners would have equal members on the board is now void. “Besides rearranging the board representations, there's nothing much to be decided immediately. The current CEO was decided on joint consent, and there is similar consent on who the successor is going to be,” sources close to Mallya told the TOI. “But they can change it all tomorrow morning, if they want to,” they added, effectively suggesting an end to Mallya’s control over the company. “We believe in the Indian beer market and United Breweries' long-term future and are happy to have increased exposure to its future progress. Heineken's purchase doesn't materially change the ownership structure or our successful collaboration,” Heineken said in a statement though. Mallya has not commented on the matter yet.