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Vijay Mallya resigns as Chairman of USL, receives USD 75 million from Diageo

by IBNS 26 Feb 2016, 08:29 am

New Delhi, Feb 26 (IBNS) Liquor baron Vijay Mallya resigned as the Chairman of United Spirits Ltd (USL) on Thursday, only to serve as the founder emiritus of the company founded by his family.

His resignation came after the company's board alleged fund misplacement against him, allegations Mallya had denied.

Mallya's resignation also saw a plunge in USL's shares by as much as six percent on Friday.

"The time has now come for me to move on and end all the publicised allegations and uncertainties about my relationship with Diageo and United Spirits Limited. Accordingly, I am resigning (from) my position with immediate effect," Mallya said in a statement on Thursday.

Mallya will also receive USD 75 million from Diageo as per the agreement.

He will be receiving USD 40 million on Friday and the next 35 million in a installment over the next five years.

The liquor baron had sold most of his shares in the USL to London based Diageo in 2012, amidst turbulent financial conditions.

However, Mallya's son Siddharth will remain in the board and cannot be removed from it for the next two years.