The overall debt will come down to around Rs 1,000 crore if the financial liabilities of Sical Logistics (another listed company from its stable) and that of Magnasoft Consulting, the privately-held IT services firm, are not included.
“The company is confident that ongoing divestments will significantly reduce the debt position of the Coffee Day
group. The financial position and asset base of the group will be comfortable to service debt obligations of the entire group,” CDEL said in a filing to the stock exchanges. “We reiterate that the debt obligations of the Coffee Day
group will be honoured. We request all the lenders and creditors to give us sufficient time to honour the commitments and unlock the true potential value of the assets.”
In a separate filing, Chennai-based Sical Logistics said it had sought a one-time moratorium of three months, starting August, from its lenders for servicing debt, which stood at Rs 1,488 crore by the end of July.
“The company would utilise the available internal resources to augment the existing cash flows to cater to the needs of the business verticals,” the Chennai-based logistics firm said.
After the demise of Coffee Day founder V G Siddhartha last month, this is the first time the group gave a clear picture of its overall debt position.
According to the group, its subsidiaries Tanglin Developments, which is into tech park development, and Sical Logistics carried the most amount of debt in their books till July this year.
Tanglin Developments’ debt was Rs 1,622 crore, and its flagship coffee retailing arm, Coffee Day Global’s total debt stood at Rs 1,097 crore.
Similarly, Coffee Day Enterprises
owed Rs 480 crore to its creditors while its financial services wing, Way 2 Wealth Securities, had total obligations of Rs 121 crore. The group’s hospitality wing Coffee Day Hotels and Resorts had a debt of Rs 137 crore.
Overall, the Coffee Day Group’s total debt stood at Rs 4,970 crore of which Rs 4,796 crore was classified as secured loan. The remaining Rs 174 crore was unsecured loan.
Sources said disclosure of its debt position is likely to help the firm get back shareholders’ confidence. Market participants were wary about the group’s financial health as Siddhartha’s purported letter had hinted at some financial transactions beyond the knowledge of the board, auditors and close family members.
During the last board meeting held on Wednesday, CDEL had disclosed its plan to sell Global Village Tech Park, one of its prized assets, to Blackstone for a valuation ranging from Rs 2,600 crore to Rs 3,000 crore, as part of the deleveraging measure.
Sources also said the group could look at monetising its stake in Coffee Day Hotels & Resorts, Sical Logistics and Magnasoft to reduce debt further.