Vijay Mallya is an Indian businessman who served as Chairman of United Spirits, India’s largest spirits company, and as Chairman of the UB Group, an Indian conglomerate with interests in aviation, spirits, real estate and fertilizer. However, Mallya has become better known for the controversial collapse of his Kingfisher Airlines airline, and for being a fugitive from justice in India.
Early Success and Growth of UB Group
Vijay Mallya was born in 1955 in Bantwal, Karnataka to Vittal Mallya, who had built up United Breweries Group. Vijay inherited United Spirits from his father at the age of 28 and oversaw its rapid growth, turning into the world’s second largest spirits company.
Mallya also expanded the UB Group conglomerate, acquiring Berger Paints in 1988, Best & Crompton in 1988, The Asian Age newspaper in 2000, and the franchise for the Formula One team Spyker in 2007 which he renamed Force India.
Forbes magazine ranked Mallya as India’s 43rd richest person in 2014, with a net worth of $1 billion. He was known for his extravagant lifestyle, owning a private yacht which was previously owned by the Sultan of Brunei, and lavish parties attended by Bollywood stars.
The Collapse of Kingfisher Airlines
In 2005, Mallya launched Kingfisher Airlines, a major new carrier in India named after his company’s bestselling beer. Mallya had ambitious plans to quickly expand the airline domestically and internationally.
However, high fuel prices, rising interest rates, and cutthroat price competition with new low-cost carriers in India proved challenging. Kingfisher accumulated huge losses, totalling over $1 billion by 2012. The airline had mounting debt and owed money to banks, suppliers, employees and the Indian government.
Kingfisher Airlines ended operations and had its license suspended in late 2012. The collapse led to accusations of poor management and financial missteps by Mallya.
Accusations of Fraud and Money Laundering
As Kingfisher Airlines collapsed, Mallya continued to live a lavish lifestyle even while owing billions in debts. Indian authorities accused him of defrauding banks by acquiring loans for Kingfisher Airlines without good faith intention to repay them.
He was also accused of laundering money through a complex web of international companies and bank accounts. The Enforcement Directorate charged him with money laundering offences and demanded his passport be impounded.
In early 2016, a group of banks petitioned the Supreme Court to stop Mallya from leaving India, but he had already fled the country days earlier. Mallya became an absconder from justice in India.
The Indian government made repeated efforts to extradite Mallya from the UK to face charges. He denies all allegations and remains on bail in the UK fighting extradition. The long saga has damaged his reputation in India, where he was once hailed as the “King of Good Times” but is now seen as a poster boy for corporate fraud.
The controversial collapse of Kingfisher Airlines and accusations of major financial improprieties have transformed Vijay Mallya from a business tycoon into a tarnished symbol of greed and corruption in India. Despite his early success, his legacy will be defined by his troubled airline and status as a financial fugitive.