After British multinational Diageo Plc. signed a severance deal with Vijay Mallya to have him step down from the board of United Spirits, now Dutch firm Heineken International may ask Mallya to leave the board of United Breweries, Reuters reported, citing three people with the direct knowledge of the plan.
Heineken currently holds a 42.4 percent stake in United Breweries and may be interested in increasing its stake even further in the company that is operating in one of the world's fastest growing breweries markets. The time for the Dutch firm is strategic given that Mallya is embroiled in a debt trap with his now-defunct airline company Kingfisher.
According to the Reuters report, a spokesman for Heineken declined to comment on any move to further up the stakes in United Breweries. However, he added that India remains an "exciting opportunity" for expansion with its right demographics and the strong economic fundamentals.
The sources told Reuters that Heineken could either ask Mallya to step down from the board of United Breweries that he chairs or call a shareholding meeting to vote for having him removed.
India accounts for around 13 percent of the world's beer consumption and is likely to overtake the global average by 2019, Reuters reported, citing ratings agency Moody's.
Vijay Mallya is facing various charges by India's many investigative agencies. He was declared a wilful defaulter by Punjab National Bank and a consortium of 17 banks led by State Bank of India is pursuing legal options to recover approximately $1 billion in loans lent to Mallya and Kingfisher Airlines. In 2012, Forbes ranked Mallya as the country's 45th richest person with $1 billion in wealth.
