The sale of Coffee Day Enterprises (CDEL) tech park to Blackstone is expected to reduce the company's debt to Rs 1,000 crore, according to a release filed with the exchanges.
The company sold Global Village Tech Park under it is real estate arm Tanglin to Blackstone for Rs 2600-3000 crore on August 14.
In a BSE filing, the company said, “The Company has already announced the divestment of Global Village Tech Park (Global Village) held by its subsidiary Tanglin Developments Limited for an aggregate consideration of Rs 2,600-3,000 crore. On receipt of the consideration for the sale of Global Village after payment of required statutory payments, the debt position of Coffee Day Group will reduce around by Rs 2,400 crore.”
The debt position of the coffee day group (excluding Sical and Magnasoft) post repayment of debt out of proceeds from sale of Global Village will be Rs 1,000 crore in the next 45 days.
“The company expected to have a comfortable position to service the reduced debt obligations,” the statement added.
The company's debt as on July 31 was Rs 4,970 crore, with the debt incurred by its logistics arm, Sical, accounting for about Rs 1,488 crore. In the filing, the company said, “CDEL’s logistics arm Sical is also working on divestment of certain assets. The proceeds from the divestment is expected to significantly reduce the debt in Sical.”
The debt position of its other subsidiaries are Tanglin Developments, which stands at Rs 1,622 crore, Coffee Day Global at Rs 1,097 crore, Coffee Day Enterprises at Rs 480 crore and Way2Wealth Securities at Rs 121 crore. Tanglin Retail Reality Development and Magnasoft consulting has debt amounting to Rs 15 crore and Rs 10 crore respectively.
Going by the assets and its valuations listed in the purported letter written by VG Siddhartha before his death on July 27, the assets are worth Rs 18,000 crore.
Given that value of assets outweigh the debt burden, the board has also requested its lenders and creditors to give sufficient time to honor the commitments and to unlock the true potential value of the assets.
“The company is confident that the ongoing divestments will significantly reduce the debt position of Coffee Day Group. The financial position and asset base of the Coffee Day Group will be comfortable to service the debt obligations of the entire group in full,” the company said in the filing.
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