UBHL also gave ‘letter of financial support’ to US firm
Chairman of UB group Vijay Mallya got a total remuneration of about Rs 1.5 crore from two overseas companies for the year 2012.
The total remuneration of $263,700 (about Rs 1.47 crore) for 2012 included $1,20,000 for services rendered as Chairman of a company called Mendocino Brewing Company, which disclosed the information in its regulatory filing with the US Securities and Exchange Commission (SEC).
Besides, Mallya was paid 89,600 British pounds (about $143,700) by Mendocino’s wholly-owned subsidiary, United Breweries International (UK) Ltd for promoting its “products in the foreign territory outside the UK”.
Mendocino, in which India-listed United Breweries Holdings Ltd (UBHL) has 68.1 per cent stake and another group firm United Breweries of America 24.5 per cent stake, has exclusive licence to brew and distribute Kingfisher Premium Lager beer in certain foreign markets.
Incidentally, Mendocino also disclosed in its filing that it received a “letter of financial support” from UBHL, wherein it has been promised funding on an “as needed basis” to Kingfisher Beer Europe Limited (KBEL). KBEL is a wholly-owned subsidiary of UB International (UK) Ltd, which is a 100 per cent subsidiary of Mendocino.
“On March 22, 2013, United Breweries (Holdings) Limited issued a letter of financial support on behalf of KBEL, to KBEL’s accountants, to confirm that UBHL had agreed to provide funding on an as needed basis to KBEL to ensure that KBEL is able to meet its financial obligations as and when they fall due. This Letter of Support would be available till at least March 22, 2014.” Mendocino said.
Mendocino operates in the US, Canada and various European markets and has Mallya as its Chairman. Its main shareholder UB Holdings Ltd (UBHL) is the holding company of all the listed entities of Mallya-led UB group in India.
The UB group is facing difficulties in its aviation venture Kingfisher Airlines (KFA) for quite some time; it was grounded since October 2012, due to mounting debt and losses, as also non-payment of staff salaries. Lenders of KFA have been asking the promoters to infuse funds but without success, forcing them to commence the process of recovering their loans by selling shares of United Spirits Ltd and Mangalore Chemicals and Fertilizers pledged as collateral.