(TDB) - Diageo could stand to lose shares worth £315 million from its Indian subsidiary United Spirits (USL) if “adverse” rulings are taken on legal proceedings against its former holding company.

Diageo purchased over 10 million USL shares from holding company UBHL in June last year for R32.35 billion (£315m), the final part of a £1.85bn takeover that began with an initial share purchase in 2012. The purchase in June 2014 gave Diageo a majority stake of 54.8% in the Indian spirits producer.

However, this final shares purchase is facing legal challenges by various lenders to UBHL. These lenders argue that UBHL, under the leadership of its controversial chairman Vijay Mallya, has defaulted on its loans.

Diageo stands to lose its title to the 10m shares it bought to complete the takeover last year if the Indian courts find in favour of these lenders, the company told shareholders in its annual report.

“Adverse results for Diageo in the proceedings… could… ultimately result in Diageo losing title to the 10,141,437 USL shares acquired from UBHL,” the company revealed. At current exchange rates, these shares are worth roughly £315m.

However, Diageo insists that it will still be the controlling shareholder in USL, even if it looses its majority stake.

“Diageo believes it would remain in control of USL and be able to consolidate USL as a subsidiary regardless of the outcome of this litigation,” it said.

Five litigations were standing against UBHL before Diageo began share purchases in November 2012. Diageo was given High Court permission to begin these purchases, despite the cases against UBHL.

However, this permission, or Leave Order, did not extend to subsequent litigations that have emerged since November 2012, for which Diageo is liable.

“Additional winding-up petitions have been brought against UBHL since November 9, 2012, and the Leave Order did not extend to them,” Diageo said.

In April last year, the Diageo-controlled board of USL said that it had “lost confidence” in Vijay Mallya and called for him to resign. It cited alleged financial violations revealed by a probe into the company’s accounts by PwC.