Shaw Wallace, UB end legal battles, finally

The Chhabria-controlled Shaw Wallace on Monday claimed it had settled all lawsuits with its competitor, Vijay Mallya's UB Group. Besides, both McDowell & Co and UB Holdings had sold their stakes in it, Shaw Wallace said in a release.

The UB Group spokesman said the group had no comment to offer on the issue. UB Group chairman Vijay Mallya was not available for comment. "This brings to an end a series of legal cases, some dating as far back as the 1980s," the Shaw Wallace release said.

According to Shaw Wallace, the most critical case was a suit in a Hong Kong court filed by two local companies, Alexina Investments and Sovereign Nominees, associated with the Golden Eagle Trust, of which Mallya is a discretionary beneficiary.

The late MR 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, which was the special purpose vehicle created for acquiring shareholding in Shaw Wallace in the mid-1980s. After over a decade of litigation, both sides filed consent terms on June 18, 2004, upon which the Hong Kong court dismissed the case.

In India, the dispute between Shaw Wallace and the UB Group was over the shareholding acquired by McDowell and UB Holdings in the former in the mid-1990s and 2002.

It was on the basis of this shareholding that McDowell had approached the Bombay high court in 2002, seeking an injunction against the business restructuring at Shaw Wallace, which was in talks to set up a joint venture with SABMiller.

McDowell has since withdrawn its suit from the Bombay high court. Both McDowell and UB Holdings have sold their holdings in Shaw Wallace. In a reciprocal gesture, Shaw Wallace, too, has withdrawn its petition before the Company Law Board and the Calcutta high court, seeking to nullify McDowell's share acquisition on the grounds that it was not a bona fide act.

The two also settled another case where McDowell had taken a debt assignment in 1995-96 from Pearl Polymers, which had filed a winding-up petition against Shaw Wallace for not repaying debt.

McDowell was initially insistent on pursuing the winding-up petition in the Calcutta high court, but, as part of an overall settlement, has withdrawn it.

Another suit relating to the acquisition and control of Mangalore Breweries, filed by Shaw Wallace against the UB Group and Mangalore Breweries' original promoter AJ Shetty, was dropped by Shaw Wallace.