HC: Banks can sell pledged shares
UB plea to stop offloading of shares rejected Mumbai (Agencies): In a significant decision, the Bombay high court on Tuesday rejected a plea by...
UB plea to stop offloading of shares rejected Mumbai (Agencies): In a significant decision, the Bombay high court on Tuesday rejected a plea by United Breweries Holdings Ltd (UBHL) for a three-week halt on banks selling shares of UB Group companies. The shares were pledged with the banks as collateral for loans taken favouring Kingfisher Airline. Thus the lenders, to recover their monies partly, can continue selling of pledged shares of United Spirits (USL), Mangalore Chemicals and Fertilizers (MCF). Sources said that the banks have already sold MCF shares held by them. Earlier, Vijay Mallya controlled UB group, promoter of Kingfisher Airlines, petitioned to Bombay High Court to halt the Kingfisher Airlines' bankers to off-load pledged shares, claiming that the action would impact investors adversely. However, the SBI lawyer said that the lenders' consortium has decided to sell the shares in a judicious manner, in tune with the market movements. The bank has already sold over 2 lakh shares with information to airline that they are seeking to recall the loans. Apart from shares, the lenders also hold two properties in Mumbai and Goa and two helicopters, the Kingfisher Airlines brand as collateral, in addition to a personal guarantee from Vijay Mallya. Consortium of 14 banks, which lend to Kingfisher Rs 7,000 crore, have started selling shares of USL and MCF pledged to them when the debt was restructured in 2011.