Update following USL announcement re. outcome of internal inquiry
Diageo is providing this update following the announcement by United Spirits Limited ("USL" and “the Company”) on 25 April 2015 in relation to its internal inquiry into certain matters referred to in USL''s financial statements and the auditor''s report for its financial year ended 31 March 2014.
In its announcement, the board of USL stated that they had lost confidence in Dr Vijay Mallya continuing in his role as a director and as chairman and therefore the board of USL called upon Dr Mallya to resign forthwith as a director and as chairman of the board and step down from his positions in the Company’s subsidiaries.
The board of USL also resolved that, in the event Dr Mallya declined to step down, it would recommend to the shareholders of the Company the removal of Dr Mallya as a director and as the chairman of the board. Dr Mallya has indicated he will not tender his resignation.
Diageo is the majority shareholder in USL with a 54.78% holding. As previously announced by Diageo, it has certain contractual obligations to support Dr Mallya continuing as non-executive director and chairman of USL subject to certain conditions and in the absence of certain defaults. Further details of these arrangements are given below.
Subsequent to its announcement on 25 April 2015, USL has provided its inquiry report and all related materials to Diageo. Diageo notes the recommendation of the USL board and will now consider its position under its agreements with Dr Mallya and United Breweries (Holdings) Limited (“UBHL”) in light of the inquiry report and materials provided to it.