The United Breweries (Holding) Company, promoter of the now defunct Kingfisher Airlines Ltd. (KAL), on Thursday told the High Court of Karnataka that though its total assets of around ₹7,500 crore are not enough to repay KAL’s debt of around ₹12,500 crore, the company reiterated its offer of assets worth another ₹7,500 crore from several contributory companies.
A submission was made before a Division Bench comprising Justice L. Narayana Swamy and Justice P.B. Bajanthri during the hearing of its appeal, against the February 7, 2017 order of the company court for winding up the UBHL (which was a corporate guarantor for KAL), to recover the money to be paid to the secured and unsecured creditors of KAL.
Appearing for the UBHL, senior counsel Sajjan Poovayya said that boards of these contributory companies, which are operating under the UBHL flagship, have passed a resolution to offer assets for repayment of debt to save UBHL from being wound up so that their ‘flagship company remains afloat as UBHL alone is not in a position to repay the entire loan amount along with interest’.
Claiming that the total amount due is around ₹10,000 crore and another ₹3,000 crore is required to pay other debts, both secured and unsecured, he contended that sale of all assets, including shares held by UBHL, and assets of contributory companies would yield close to ₹15,000 crore.
He pointed out that the shares, held by UBHL, required to be sold immediately to realise a part of the money to repay the debt as the value of the shares would decline owing to stock market volatility during election year while referring to an application, filed before the HC several months ago, for sale of shares through a court-appointed committee.
Manmohan Singh Kapur, erstwhile director of UBHL, in his application had sought for a direction from the court to constitute an empowered committee/court commissioner comprising a retired judge of the Supreme Court or the High Court, along with such other persons to monitor and superintend the sale of assets, including shares, which are attached by the Enforcement Directorate under the Prevention of Money Laundering (PML) Act.
UBHL is offering to make payment not with any rider that authorities should not prosecute its promoter, Vijay Mallya and others, and admitted that it is difficult for the UBHL to contest winding up process as its assets are far less than the total debt of KAL.
Meanwhile, the court permitted the Official Liquidator to give on lease/rent the vacant properties of UBHL subject to final approval of the court.
Further hearing has been adjourned till January 3.
