Coffee Day Enterprises Ltd (CDEL), currently reducing its debts through asset resolution, conveyed in a regulatory update that the postponement in debt servicing is attributed to a liquidity crisis.
Coffee Day Enterprises Ltd. has declared a total default of Rs 433.91 crore for the December quarter, encompassing interest payments and principal amount repayment on loans from banks, financial institutions, and unlisted debt securities. In a regulatory update, the company attributed the delay in debt servicing to a liquidity crisis.
CDEL’s default includes Rs 183.36 crore on the principal amount of loans or revolving facilities, such as cash credit from banks or financial institutions, as of December 31, 2023. Additionally, it has defaulted on the repayment of interest amounting to Rs 5.78 crore. Unlisted debt securities, including Non-Convertible Debentures (NCDs) and Non-Convertible Redeemable Preference Shares (NCRPS), contributed to a default amount of Rs 200 crore as of December 31, coupled with an interest payment default of Rs 44.77 crore.
Considering the loan recall notices, legal disputes, and the ongoing one-time settlement negotiations with the lenders, the company has not recognized interest since April 2021.”
Following the demise of Founder-Chairman V G Siddhartha in July 2019, CDEL has been strategically reducing its debt through the resolution of assets. In March 2020, the company repaid Rs 1,644 crore to 13 lenders after finalizing a deal with the Blackstone Group for the sale of its technology business park. Additionally, the company is actively pursuing legal avenues to recover over Rs 3,535 crore allegedly diverted from the company into Mysore Amalgamated Coffee Estates Ltd, a personal firm promoted by V G Siddhartha.
Coffee Day Enterprises: Defaults, Legal Battles, and Asset Resolution Challenges
Regarding unlisted debt securities like Non-Convertible Debentures (NCDs) and Non-Convertible Redeemable Preference Shares (NCRPS), the default amounted to Rs 200 crore as of December 31, accompanied by a default in the payment of interest totaling Rs 44.77 crore.
Given the loan recall notices, legal disputes, and the ongoing one-time settlement negotiations with the lenders, the company has refrained from recognizing interest since April 2021.”
After the passing of Founder-Chairman V G Siddhartha in July 2019, Coffee Day Enterprises Ltd. strategically reduced its debts through the resolution of assets. In March 2020, CDEL announced the repayment of Rs 1,644 crore to 13 lenders following the successful conclusion of a deal with the Blackstone Group for the sale of its technology business park. The company is actively pursuing legal avenues to recover over Rs 3,535 crore allegedly diverted from the company into Mysore Amalgamated Coffee Estates Ltd, a personal firm promoted by V G Siddhartha.
UPDATE: Coffee Day Enterprises Ltd has disclosed a total default of Rs 433.91 crore in interest and principal payments on loans from banks, financial institutions, and unlisted debt securities during the December quarter. Additionally, it defaulted on the repayment of interest amounting to Rs 5.78 crore. Unlisted debt securities, including Non-Convertible Debentures (NCDs) and Non-Convertible Redeemable Preference Shares (NCRPS), contributed to the default amount of Rs 200 crore as of December 31, accompanied by a default in interest payment totaling Rs 44.77 crore.
CURRENT SCENARIO: Given the loan recall notices, legal disputes, and the ongoing one-time settlement negotiations with the lenders, the company has refrained from recognizing interest since April 2021,” it stated.
STRATEGIC RESPONSE: Following the demise of Founder-Chairman V G Siddhartha in July 2019, CDEL strategically reduced debts through asset resolution. In March 2020, CDEL announced the repayment of Rs 1,644 crore to 13 lenders after concluding a deal with the Blackstone Group to sell its technology business park.
LEGAL PURSUIT: The company is actively pursuing legal measures to recover over Rs 3,535 crore allegedly siphoned off from the company into Mysore Amalgamated Coffee Estates Ltd—a personal firm promoted by V G Siddhartha.
