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 "Indian businessman Vijay Mallya leaves the Royal Courts of Justice in London, Britain February 11, 2020. (REUTERS/File Photo)")
Indian businessman Vijay Mallya leaves the Royal Courts of Justice in London, Britain February 11, 2020. (REUTERS/File Photo)
The Securities and Exchange Board of India (Sebi) has barred fugitive businessman Vijay Mallya from accessing the Indian markets for three years for using the foreign portfolio investor (FPI) route for routing funds into Indian securities between 2006 and 2008. The former liquor baron has also been barred from associating with any listed company for a period of three years. It has directed the freezing of all securities holdings, including mutual fund units.
Mallya, through an FPI entity named Matterhorn Ventures, indirectly traded in scrips of his own group entities in India, thereby concealing the true identity of his investments in the securities market.
The investments through the FPI route are only meant for entities non-resident Indians.
“The noticee (Mallya) has glaringly resorted to making investments through the FPI route by masking his identity under the garb of an FPI Matterhorn Ventures to the detriment of the interest of shareholders of Indian companies,” Sebi said in an order.
As per the Sebi order, the FPI entity was used to deal in shares of the erstwhile spirit company Herbertsons and United Spirits (USL).
“…the shareholding of Matterhorn Ventures of 9.98 per cent shares of Herbertsons actually belonged to the promoter category being totally funded by the noticee,” Sebi has observed.
Through a process of mergers and acquisitions, Herbertsons became USL, which is currently owned by British multinational Diageo.
“Such acts of the noticee are not only fraudulent and deceptive but are a threat to the integrity of the securities market,” Sebi said.
Earlier, in an order dated June 1, 2018, Sebi had debarred Mallya from accessing the securities market for three years for the diversion of funds and improper transactions in the scrip of USL.
First Published: Jul 26 2024 | 7:45 PM IST
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