From Bathrobe to Jet: Vijay Mallya’s Assets to go under Hammer

Mangalore Today News Network

Mumbai July 31, 2016 : Embattled businessman Vijay Mallya’s assets worth over Rs. 700 crore will go under hammer next month.The items waiting for the right bidders are plenty -- the erstwhile headquarters Kingfisher House near airport here; cars and office furniture; Mr Mallya’s plush personal jet along with everything inside that include cushy couches and even a bathrobe; Kingfisher Villa in Goa famous for parties hosted by Mr Mallya; and numerous brands and trademarks including the famed ’Fly with Good Times’.

This would be the second try by the lenders and tax authorities at auction of these assets as part of their efforts to recover thousands of crores worth outstanding dues, after the earlier attempt for each of these properties proved to be a damp squib.

Mr Mallya’s personal jet is being put under hammer by the service tax department, while other properties will be auctioned by the lenders whose dues from long-grounded Kingfisher Airlines have ballooned to over Rs. 9,000 crore including penal interest.

For almost all the properties, the reserve price has been marked down after the earlier attempts failed to attract bidders.

The 17-bank consortium, led by the State Bank of India, is re-auctioning Kingfisher House in Mumbai and the airlines’ trademarks and brands, including the ’Kingfisher’ logo.

On August 4, the lenders will re-auction Kingfisher House, the erstwhile headquarters of the airline, at a lower reserve price of Rs. 135 crore. In the initial attempt in March to sell the property with a built-up area of over 17,000 sq ft in plush Vile Parle area near domestic airport here, not a single bidder came forward at the then reserve price of Rs. 150 crore.

Banks have also put up some of the movable secured assets worth Rs. 13.70 lakh lying at Kingfisher House for sale. These assets will be auctioned separately on August 25 by SBI Cap Trustee, which possesses these assets on behalf of the lenders.
 
The items on sale would include eight cars - Toyota Innova, Honda City, Honda Civic and Toyota Corolla, among others. The reserve price of each car has been set differently in the range of Rs. 90,000-2.50 lakh.

These items will be sold on individual basis and not below the reserve price, according to a public notice put up by SBI Cap Trustee.

In another second attempt, banks will auction brands and trademarks of Kingfisher Airlines including the Kingfisher logo as also the once-famous tagline ’Fly the Good Times’ on August 25.

The other trademarks on sale included Flying Models, Funliner, Fly Kingfisher and Flying Bird Device. The reserve price for auction of brands and trademarks has also been reduced to Rs. 330.03 crore from Rs. 366.70 crore earlier.

In the heydays of Mallya-led group, the Kingfisher brand itself was valued at over Rs. 4,000 crore by Grant Thornton when the airline was at its peak.

In its annual report for 2012-13, KFA said that at it peak, it was the largest airline in the country with a five-star rating from Skytrax. The airline’s brand had been registered separately from the Kingfisher beer trademarks.

Banks will also soon auction Kingfisher Villa situated at Condolim, in north Goa, which they took possession from the group in May this year after a long legal battle.

The date for the auction of Kingfisher Villa has not been announced so far, but it can also happen in August itself.

According to sources, valuation process by the banks is underway for the Villa, which has come out to be around Rs. 90 crore.

Meanwhile, the service tax department will again auction the luxury personal jet of Mallya on August 18.

In the earlier auction on June 30, the department had rejected the sole bid of Rs. 1.09 crore offered by the United Arab Emirates-based aviation support firm Alna Aero Distributional Finance Holdings, against a reserve price of Rs. 152 crore.

The new pricing has not been announced yet by the Department but sources say it would also be lowered.