While most other regulatory approvals were in place, YES Bank, the single-largest lender to the Coffee Day Group, had shown reluctance to give its nod to the deal unless the latter repays the entire loan taken at the group level or at least those availed by its subsidiaries Tanglin Developments and Sical Logistics. This had caused a major roadblock for CDEL in receiving the first tranche proceeds from Blackstone
of Rs 2,000 crore that is expected to reach it anytime soon.
“The plan is to first settle the loans taken by Tanglin out of whatever money the company receives in first tranche after the regulatory and tax expenses. As a part of that, YES Bank
would have received Rs 100 crore, its exposure to Tanglin though they wanted Rs 50-crore loan that was taken by Sical,” said another person.
Both YES Bank and CDEL could not be reached for comments.
By the end of July, Coffee Day group’s aggregate debt position stood at Rs 4,970 crore of which Tanglin Developments’ liabilities stood at Rs 1,622 crore followed Coffee Day Global, its retailing arm, at Rs 1,097 crore. The group has initiated several deleveraging measures to reduce its overall debt for which it has hired IDFC Securities as consultant. Besides, subsidiary Sical Logistics has also appointed ICICI Securities for finding out various deleveraging options.
“Sical has something (received some proposals) that they are working on. It’s a work in progress though they may have to wait for some more time,” sources added.
Meanwhile, CDEL is waiting for the report of the internal investigation it has announced earlier to probe into the content of the letter allegedly written by its former Chairman V G Siddhartha and scrutinise its books of account before expanding its board of directors.
Ashok Kumar Malhotra, a former DIG at the Central Bureau of Investigation, has been hired for this while he is being assisted by external agencies, including law and auditing firms. CDEL currently has a three-member board, including Siddhartha’s wife Malavika Hegde and S V Ranganath, a retired bureaucrat who acts as the chairman now.