Mallya, New CEO Leave Whyte & Mackay

Updated August 13, 2013 –  More changes at Whyte & Mackay are taking place, according to the Sunday Herald. Chairman Vijay Mallya and fellow director Ayani Nedunghani have left the board of the United Spirits-owned Scotch whisky unit, along with John Beard, who was named CEO just last week after leaving Bacardi Brown-Forman’s UK operations. Last week, Ashwin Malik stepped down as Whyte & Mackay CEO to return to India with his family.

Mallya still maintains an indirect role at Whyte & Mackay, since he continues to serve as chairman of United Spirits even as Diageo holds a controlling stake in the India-based spirits company. Mallya paid £700 million GBP (approximately $1.4 billion USD) for Whyte & Mackay in 2007, and the debt service on the loans to finance the transaction helped contribute to serious financial problems for Mallya’s business empire. His Kingfisher Airlines has been grounded since October, 2012, and the Economic Times reports a consortium of Indian banks has seized the airline’s corporate headquarters building in Mumbai.

The status of Whyte & Mackay under Diageo’s control is uncertain, as the UK’s Office of Fair Trading is looking at whether Diageo’s control of United Spirits would give it an anti-competitive position in the Scotch whisky industry. An interim decision could come later this month, with the agency likely to refer the matter to the Competition Commission for final action.  Former Diageo CEO Paul Walsh indicated earlier this year before his retirement that Whyte & Mackay was surplus to Diageo’s needs, and it’s expected that the unit could be sold to satisfy regulatory concerns. The Business Standard reported Tuesday that Diageo will not exert any control at Whyte & Mackay or count the unit’s results in its financial statements until the OFT ruling, in compliance with the pledges it made to the OFT last month. Whyte & Mackay accounts for 17% of United Spirits’ annual sales, according to the report.

Whyte & Mackay spokesmen confirmed the executive changes in an email to WhiskyCast’s Mark Gillespie Tuesday, but were unable to provide any additional information.  This story will be updated as more details become available.

Links: Whyte & Mackay | United Spirits | Diageo