SAN FRANCISCO (Diya TV) — The State Bank of India have officially listed the embattled Vijay Mallya’s Kingfisher Villa in Goa on the market for Rs 85 crore in an effort to recover their funds after the bankruptcy of Kingfisher Airlines.
The estate was once the venue of famous parties thrown and hosted by Mallya, the e-auction has been tentatively set for Oct. 19 with the aforementioned price set as the minimum bid. Bankers anticipate recovering at least Rs 100 crore in the auction of the estate.
Three of Mallya’s past companies — United Spirits, Kingfisher Airlines and United Breweries — had objected at the local courts on banks’ taking physical possession of the Villa. Lenders assumed control of the sprawling estate in May 2016 after repeated attempts to stop the foreclosure by United Spirits.
When lenders had initially tried to take control of the property, the housekeeper, an employee of United Spirits, tried to establish tenancy rights on the property. This delayed banks from taking physical possession of the Villa.
United Breweries had provided corporate guarantee while Vijay Mallya had given personal guarantee for the Rs 7000 crore loan availed by Kingfisher Airlines. The property, having an aggregate area of 12,350 sq mts, is located at Condolim in Goa.
Regardless, lenders have vowed to reclaim the entirety of the funds loaned to Mallya, who fled the country to the UK back in March. Efforts to recover the funds became amplified after comments made by former Reserve Bank of India’s governor Raghuram Rajan said soon after Vijay Mallya celebrated his 60th birthday with lot of fanfare.
Rajan said, “If you flaunt your birthday bashes even while owing the system a lot of money, it does seem to suggest to the public that you don’t care. I think that is the wrong message to send. If you are in trouble, you should be cutting down your expenses.”
So far, banks have recovered just about Rs 1400 crore by selling shares of USL.
The auction of the villa would be critical for banks since the they failed in previous two attempts to sell Kingfisher House located new Mumbai Airport. Also, banks did not receive any bid for the Kingfisher logo.
