UB group chairman Vijay Mallya will decide on his counter offer for Herbertsons after the Securities Appellate Tribunal gives its verdict on the petition challenging its earlier order, on Wednesday.

If a counter offer is made, it will amount to acknowledging Kishore Chhabria's additional stake in Herbertsons, which has been contested by Mallya. Therefore, if the tribunal's order went against him, Mallya might take the matter to the Supreme Court, UB group executives said.

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"Making a counter offer is just one of the options that we are exploring at present since it will mean that we are acknowledging the 43 per cent stake held by Chhabria, a part of which was acquired illegally. Since this is what we have been trying to prove in the court, a decision on the future course of action will be taken on Wednesday after the tribunal gives its verdict," a company executive said.

The sources added that Mallya had appointed Kotak Mahindra as merchant banker to the counter offer. "While the last date for announcing the counter offer is September 11, we just want to be prepared," said an official.

Earlier this month, the tribunal had passed an order directing Chhabria to make an open offer for a 20 per cent stake in Herbertsons within the next three months.

The order, therefore, recognised the 43 per cent stake held by Chhabria in the firm. Mallya, who has been battling with Chhabria for control of Herbertsons, owns around 30 per cent in the company.

Both Mallya and Chhabria have been angling for an out-of-court settlement on the issue for some time now. Earlier, Mallya had said he was working on a deal, wherein Chhabria would sell his entire stake in Herbertsons, which owns the country's largest selling whisky brand, Bagpiper, and would take BDA Distilleries in return, which owns the Officer's Choice whisky.

Last week, Mallya had told Business Standard that an agreement had been reached between the two for Rs 100 crore (Rs 1 billion) and the process would be completed in the next two months. Chhabria, however, had denied any such agreement.

Chhabria brought BDA Distilleries to the Herbertsons stable in 1992 after splitting with his brother Manu Chhabria, and got a 20 per cent stake in Herbertsons in return. Later, Chhabria increased his shareholding in the company.

The tribunal's order had overturned an earlier decision by the Securities and Exchange Board of India, which required Mallya to reduce his holding in the company to 21.4 per cent. Chhabria was asked to reduce his stake to 10 per cent through an open offer for sale of shares at face value of Rs 10 each.