Kingfisher Airlines (KFA) Chairman Dr Vijay Mallya in firing line as Lenders put squeeze on entire UB Group assets

Even as the UB Group is being pushed to the wall by creditors who have managed to secure a virtual freeze on its assets, chairman Dr Vijay Mallya is set to face shareholders over a series of annual general meetings during the next couple of weeks.

It was around this time a year ago that the group first announced it was negotiating with British liquor company Diageo for a stake sale and also talking to foreign carriers for a possible investment in Kingfisher Airlines (KFA), both of which were seen to offer a way out of its financial troubles and to rescue the carrier.

However, the group's woes have piled up in the year since. While lenders have claimed some of the pledged assets, the airline and its parent are fighting numerous court cases, including winding-up petitions filed by some creditors, because of which they have been restrained from selling or transferring assets. Besides, the airline's lenders are also eying the money received from the Diageo deal.

With Diageo taking control over the flagship United Spirits, the focus is on how Mallya's holding company, United Breweries Holdings (UBHL), will be able to muster up the funds to pay off creditors besides detailing plans for the airline that has time till December 2014 to renew its licence. UBHL's annual general meeting is scheduled for Thursday while the shareholders' meeting for KFA is slated for September 24.

"A revival plan has been submitted to DGCA (Directorate General of Civil Aviation) which is under consideration. Further, discussions are in progress with some prospective investors for restarting the airline operations," said UBHL's annual report for FY13.

"The Board of Directors at an appropriate time will discuss the merits of commissioning an in depth study to assess the recoverability of the amounts advanced to KFA as part of its strategic review of all core investments. Meanwhile, in order to keep its investment prospects alive, the board has decided to keep the airline funded on a need basis."