Financial Daily from THE HINDU group of publications
Tuesday, Aug 10, 2004
Corporate - Corporate Disputes
UB, Shaw Wallace bury the hatchet
Bangalore , Aug. 9
SHAW Wallace & Company (SWC), managed by the Jumbo group, today announced that all disputes between it and the UB group, headed by Mr Vijay Mallya, have been resolved.
This brings to an end a series of legal cases, some dating as far back as the 1980s. Business Line (July 1 & July 3) had first reported about the truce between the country's two leading families in the liquor business in their bid to leave behind an acrimonious past.
The UB group has offered no comment on the developments.
The most critical of the litigations was a suit at a Hong Kong court filed by two Hong Kong-based companies, Alexina Investments and Sovereign Nominees (formerly known as Roche Nominees), associated with the Golden Eagle Trust of which Mr Vijay Mallya is a discretionary beneficiary.
M.R. Chhabria, Jumbo International Holdings, Keysberg and some other Hong Kong-based companies associated with the Jumbo group were the respondents.
The plaintiffs had claimed 50 per cent ownership in Carrasco, the special purpose vehicle created for acquiring shareholding in Shaw Wallace in the mid-80s.
After over a decade of litigation, both sides filed consent terms in the court on June 18, 2004 upon which the court of first instance (in the High Court of the Hong Kong Special Administrative Region) dismissed the case.
Mr Justice Waung said that upon the undertakings given by both the parties and the terms agreed upon, the case stands dismissed.
In India, the principal dispute between the two parties has been over the shareholding acquired by McDowell & Co and UB Holdings in SWC in the mid-90s and 2002.
It was on the basis of this shareholding that McDowell & Co had approached the Bombay High Court in 2002 seeking an injunction against the business restructuring at SWC in its bid to form a joint venture with SABMiller, the world's second largest brewer.
McDowell & Co has since withdrawn its civil suit from the Bombay High Court. Moreover, both McDowell and UB Holdings have disposed of their entire holding in Shaw Wallace.
Shaw Wallace too has withdrawn its petition to the Company Law Board and the Calcutta High Court seeking to nullify McDowell's share acquisition in SWC on the grounds that it was not a bona fide act and done with the sole intention of harassing the SWC management.
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