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Sun 10 Jan 2010 04:00 AM

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Driving force

Indian billionaire Vijay Mallya is the chairman of one of India's most successful conglomerates. He talks to Anil Bhoyrul about making his mark on the F1 circuit.

Driving force
Driving force
Vijay Mallya has somehow managed to steal more glory than the more established F1 players, thanks to an incredible second place finish at the Belgian Grand Prix last year.
Driving force
Kingfisher Airlines ushered in a new era of luxury in India’s domestic aviation sector with its brand new aircraft with stylish red interiors and smartly dressed crew and staff.

Indian billionaire Vijay Mallya is the chairman of one of India's most successful conglomerates. He talks to Anil Bhoyrul about making his mark on the F1 circuit.

It's not hard to find Vijay Mallya. The 54-year-old billionaire boss of the Force India F1 team is usually surrounded by several supermodels, and has a permanent grin on his face. His motor home at the inaugural Abu Dhabi Grand Prix is packed with celebrities, business leaders and an entourage of at least ten PAs and PR people. And Mallya is milking every moment of the first ever UAE F1 race.

"They say you can always outdo yourself. I think it's fair to say that Abu Dhabi  have outdone themselves,  but I knew that this would happen because in this region everything is larger than life," he tells CEO Middle East.

The same could be said about Mallya. Born the son of Indian industrialist Vittal Mallya, the chairman of one of India's most successful conglomerates, the United Breweries Group (UBG), Mallya assumed his father's position at UBG in 1984. Today, Mallya has an estimated net worth of $1.2bn, which regularly sees him listed on Forbes' annual Rich List.

But that's just for starters. In addition to the F1 team, there is also Indian Premier League Cricket team, a horse racing company, and the customary yacht on which he is renowned for throwing lavish parties.

In fact, it seems nothing is out of reach.  Eight months ago he successfully bid $1.8m for the belongings of Mahatma Gandhi at a New York auction, which caused uproar in India after the government tried and failed to block the sale. "I guess I am in the news a lot. Maybe all publicity is good publicity, I think," he says with a wry smile.

Most of the publicity Mallya generates these days is down to his ever increasing role in the Formula One circus. In 2007, Mallya and the Mol family from The Netherlands bought the Spyker F1 team for $120m. The team changed its name to Force India F1 from the 2008 season and quickly became synonymous with India's own F1 aspirations.

 The team is one of the smallest teams on the grid and only finished ninth out of ten in the constructors championship this year, yet Mallya has somehow managed to steal more glory than the more established players, thanks to an incredible second place finish at the Belgian Grand Prix.

And despite his relatively lowly position on the grid, inside the paddock Mallya has become a force to be reckoned with. A close pal of F1 supremo Bernie Ecclestone, he has managed to get a seat on the FIA World Motor Sports Council for the next four years, and in the process become "Mr F1" back home in India. Not bad considering the team spent just $70m in its first year, and less than $150m for each of the past two years - around half the spending of the likes of Ferrari and McLaren.In F1, everyone wants to be Mallya's mate. "We have shown that a small team can compete with the best. Nobody ever gave us a chance and yet we very nearly won in Belgium, and the following week in Italy we finished in the points. It shows that F1 isn't just about how much money you have," he says.

"I would like to think that we have also brought a sense of fun and enjoyment to the business. Everyone always talks about the parties on my yacht, and I see that as a good thing.

"You should have fun in life. Formula One doesn't have to be so serious all the time. I am in this business to both succeed and have a great time."

That he is certainly doing, and the F1 party may just be starting for Mallya. India is penciled in to host a race for the first time ever in 2011, and Mallya has no doubt it will happen. "It's pretty much confirmed. I have met with the promoters; it will definitely happen. I think it will be the crowning glory for F1 in India," he adds.

"For our team it will be great because in India everyone sees us at the Indian F1 team, even though we don't have any Indian drivers. We are like Ferrari in Italy - a country's team - and that makes me very proud."

Mallya, who was born in Karnakata, India in 1955, was always destined to follow in his father's footsteps. Vittal encouraged his son to train with some of the best global corporate before he began handing over the mantel of control to his son in the early 1980s. Mallya, who played a huge role in the relaunch of Kingfisher beer, became the chairman of UBG when he was just 28.

Today, the UBG is one of India's largest conglomerates and the world's third largest drinks company with annual sales of over $4bn. The group has diverse interests in brewing, distilling, real estate, engineering, fertilisers, biotechnology, information technology and aviation.

Upon assuming the position of chairman, Mallya initiated the process of defining a corporate structure with performance accountability, inducting professional management and consolidating the unwieldy empire into individual operating divisions.

 It's clearly been a job well done. In 2007, United Spirits Limited, the flagship of the UBG, acquired 100 percent of premium scotch distillers Whyte & Mackay and Liquidity, a United States-based maker of specialty vodkas.

The UB Group's Brewing Division has also assumed undisputed market leadership with a national market share in excess of 48 percent. Through a process of aggressive acquisition and market penetration, the UBG today controls 60 percent of the total manufacturing capacity for beer in India. The flagship brand, Kingfisher, is now sold in over 50 countries worldwide having received many accolades for its quality.Then there is Kingfisher Airlines, India's largest airline with more than 400 flights daily, which Mallya established in 2005. Despite still a relatively young player, the Mumbai-based carrier has already experienced significant growth.

It ushered in a new era of luxury in India's domestic aviation sector with its brand new aircraft with stylish red interiors, and smartly dressed crew and ground staff, and was the first Indian carrier to have in-flight entertainment systems on every seat with guests being able to watch live TV in-flight. "Like in F1, I think with the airline business we broke the mould. We changed the way people do things and we changed it for the better," he explains.

Mallya is known to celebrate his business success with lavish lifestyle. In addition to several homes across the world, including Stowe Castle in the UK, he also owns an invaluable collection of cars. His 311-ft yacht, the India Empress, is one of the largest privately owned yachts anywhere on the planet.

Like the rest of his empire, Kingfisher's future looks bright. "We've done well; the figures speak for themselves, even with our aviation business, and this is why we have been able to venture into other fields like F1," he says.

But is he not worried about the global downturn? "The economy in India has grown in relation to world economy's five percent GDP growth," he says confidently. "I am optimistic that the global economy is recovering and growth in India will actually accelerate.

"The PM has said we need to shoot for eight percent growth [and] I certainly think it's achievable. I am positive about the year ahead."

So what next for Mallya? "You have to keep on growing. Like I said I believe the economy has turned and that will benefit our main businesses.

"As for Formula One, we have already broken the mould. Nobody would ever have thought we could finish second in an F1 race, but that means we still have one place higher to go on the podium.

"Can we do it in 2010 and win a race? Well, no-one believed me when I said we could get a podium finish in 2009 so I guess no-one will believe me when I say we can win a Grand Prix."

Right now, people may just start believing Vijay Mallya.

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