In the end it was a day the king of good times will not forget in a hurry.
The hammer blows came one after the other: First he had to resign from the chairmanship of his group company Mangalore Chemicals and Fertilizers, then the corporate affairs ministry rejected his application for getting reappointed as managing director of Kingfisher Airlines for another 5 years without remuneration, soon after, the exchanges suspended trading in the shares of the grounded Kingfisher Airline and another group outfit UB Engineering. No one can be faulted for seeing in this the beginning of the end of Vijay Mallya's once-sprawling business empire
All this came just two days after minority shareholders of United Spirits rejected 9 out of 12 resolutions as some of these steps were seen favourable to Mallya even though he is no more the owner.
Mallya's sudden, but not quite unexpected, resignation as chairman of the board of Mangalore Chemicals, a fertilizer maker was a shocker. He had tried his best to retain control of the company after losing his liquor companies United Spirits and United Breweries.
The resignation, conveyed in a short disclosure to the stock exchanges, immediately triggered speculation about Mallya's staying power in the country's fast evolving industrial landscape and induced cheers from investors of Mangalore Chemicals who rejoiced at the exit by vigorously buying the stock pushing up its price by more than 9% to Rs98.25.
Surprisingly, Mallya tendered his resignation from outside the country triggering speculation about whether he was trying to close a desperate deal involving his holding.
Mallya, along with his partner, Kolkata-based Saroj Poddar of Adventz group, has only recently completed a failed exercise to gain majority stake in Mangalore Chemicals following a takeover bid by Sailesh Mehta-owned Deepak Fertilizer and Petrochemicals.
At the end of the two competing open offers, Mallya along with Poddar now hold 38% while Deepak Fertilizer along with Soilfert Ltd controls 31.25%. Soilfert is an entity controlled by Sailesh Mehta, against whom Mallya had joined forces with Poddar in May to ward off another takeover bid.
Mallya's exit is surprising as under the pact with Poddar, Mallya was supposed to remain Mangalore Chemical chairman for the next five years. Mallya would also be allowed to appoint three directors on the board and get the first right of refusal over Poddar's stake.
But the pact was inked before United Bank of India, a small bank based in Kolkata, proclaimed Mallya a wilful defaulter stoking the spectre of his removal from the board of all companies by taking recourse to a provision in a circular issued by the RBI, which would have prevented a defaulter from remaining director of any company.
Mallya along with directors of Kingfisher Airlines, Subhas Gupte, Anil Kumar Ganguly, Ayani Kurassi and Ravindranath Nedungadi, were named as wilful defaulters by United Bank after the grounded airlines defaulted.
But the RBI guideline was issued only in July this year, and no industrialist has been named before Mallya as a wilful defaulter, giving the once-flamboyant liquor king a dubious distinction.
Mallya however secured a stay in September from the Calcutta high court against the decision of United Bank. The high court has extended the stay till December 15.
While Mallya has been able to buy some time in one legal fight, other lenders like State Bank of India, Punjab National Bank, IDBI Bank and UCO who have also individually termed him a wilful defaulter, and as the noise turns shriller, it was clear that the inevitable would happen.
Foreseeing such a scenario, Poddar, a seasoned industrialist, is believed to have tweaked his pact with Mallya. "We continue to remain interested and that position remain unchanged. But the agreement obviously has to be modified as when we did the pact we never foresaw this scenario," Poddar had said earlier.
The pact was structured in a manner that Mangalore Chemicals would be a jointly managed. But even if Mallya can no more remain a director, Poddar would still allow him to appoint three directors.
Now all that remains a forgotten formality as Mallya has had to quit. The fizz has gone out his empire.
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