According to sources familiar with the matter, Coffee Day Global, the company behind the Cafe Coffee Day chain in India, has been granted corporate insolvency by the Bengaluru bench of the bankruptcy court. The National Company Law Tribunal (NCLT) issued an oral order last week, accepting the petition filed by IndusInd Bank and admitting the unlisted company for corporate insolvency proceedings.
The tribunal has not yet uploaded a comprehensive order as of now.
Coffee Day Global, a subsidiary of the publicly listed Coffee Day Enterprises, was established by the late VG Siddhartha. His tragic demise by suicide in 2019 sent shockwaves through the business community, leaving many in disbelief.
As of March 31, 2022, based on the most recent annual report, the company possesses a noteworthy debt of INR 67.3 crore owed to IndusInd Bank. According to an individual familiar with the matter, the company’s admission to the tribunal occurred when attempts to reach a one-time settlement agreement between the company and IndusInd Bank failed. Despite attempts to seek clarification, Coffee Day Group remained unresponsive to comment requests.
According to information available on the NCLT website, it was observed that IndusInd Bank had engaged Skanda Legal as their legal representation, while Coffee Day Global had enlisted Tatva Legal as their counsels.
As per the FY22 annual report of Coffee Day Global, an unlisted entity, it possesses 495 Cafe Coffee Day outlets spread across 158 cities and operates 285 CCD Value Express kiosks. Furthermore, the company has successfully installed 38,810 coffee vending machines in various corporate workplaces and hotels, according to the same report.
As of March 2022, the company carries a total debt of INR 960 crore, comprising bank loans and inter-corporate deposits amounting to INR 119 crore owed to Tanglin Development, a group entity.