MILAN — According to media reports, Coffee Day Global Ltd (CDGL), which owns and operates the popular coffee chain Café Coffee Day, was admitted for corporate insolvency by the Bangalore bench of the National Company Law Tribunal (NCLT) last week.
The NCLT passed an oral order on Thursday to admit the unlisted company based on a petition filed by IndusInd Bank.
“The application filed by one of the lenders against the material subsidiary CDGL before NCLT, Bengaluru, has been admitted (oral order) under Section 7 of Insolvency and Bankruptcy Code, 2016 for initiating CIRP for Rs 94 crore,” Coffee Day Enterprises Ltd, CDGL’s parent company said in a regulatory filing.said.
“Further, the material subsidiary has informed the company that, it will take the required legal action in this regard,” it said.
Coffee Day Enterprises, which owns Coffee Day Global, was promoted by the late VG Siddhartha, who committed suicide in 2019. According to reports, his suicide note addressed to the board of directors and the Coffee Day family revealed he was under heavy debt burden, Indian media report.
As of March 2022, the firm has Rs 960 crore (US$117 million) debt, which includes bank loans and inter-corporate deposits of Rs 119 crore to Tanglin Development, a group entity.
In March 2020, CDEL announced repaying Rs 1,644 crore (US$200 million) to 13 lenders after concluding a deal with Blackstone Group to sell its technology business park.
The Securities and Exchange Board of India, in January 2023, imposed a fine of Rs 26 crore on the company. The penalty was imposed for diverting funds from subsidiaries to a firm related to the promoters.
In March 2020, CDEL announced repaying Rs 1,644 crore to 13 lenders after concluding a deal with Blackstone Group to sell its technology business park.
