Cafe Coffee Day may be headed for bankruptcy after defaulting on loan payments: Report
Coffee Day Enterprises on April 6 said its total indebtedness was Rs 518 crore.
April 09, 2021 / 12:21 PM IST
Coffee Day Enterprises Limited (CDEL), which owns the Cafe Coffee Day chain, may be headed for bankruptcy after defaulting on loans during the March quarter. CDEL's lenders are considering taking the company to the National Company Law Tribunal (NCLT) for debt resolution, Business Standard has reported.
The lenders have invoked the shares pledged by CDEL's subsidiaries to recover their dues, the report said.
CDEL declined to comment when contacted by Business Standard.
The company said it has outstanding dues of Rs 280 crore in terms of cash credits from banks or financial institutions. It also owes Rs 200 crore in unlisted debt services, CDEL said in a BSE filing on April 6. CDEL said its total indebtedness was Rs 518 crore.
The company has also defaulted on the interest due on the payments that it delayed.
CDEL was planning on selling its front-end vending machine and stores' assets to the Tata Group but the talks failed due to the high valuation sought by the management, Business Standard reported.
The Economic Times said the company owed money to four lenders—Axis Bank, SSG Singapore and Aditya Birla Finance.
CDEL is awaiting Rs 700 crore in the second tranche of payment from the Blackstone Group from the sale of the Global Technology Village, the report said.
Blackstone in September 2019 agreed to buy Global Technology Village in Bengaluru for Rs 2,700 crore. The group has been battling a financial crisis after Cafe Coffee Day founder VG Siddhartha died by suicide in July 2019.