Credit rating agency ICRA Ratings has placed the term-loan rating of Coffee Day Enterprises Limited (CDEL) on watch with negative implications.
Earlier, this week, ICRA had downgraded CDEL long-term rating 'D' with negative outlook from 'BB+' (Negative) based on Rs 315 crore term loans.
In a bid to pare debt, cafe chain operator Coffee Day Enterprises have appointed IDFC Securities as an advisor to identify strategic options and advise it on refinancing of existing debt.
Siddhartha, 60, is alleged to have committed suicide on July 29 night by jumping off the road bridge into the Netravathi river, as his body was found on its banks on July 31 morning.
According to police sources, water was found in Siddhartha's lungs and his death was due to drowning.
Hegde would look after the family’s coffee plantations in Chetanahalli, Mudigere taluk. He was born to Veerappa Hegde and Sheshamma Heggadithi on February 6, 1924.
Coffee Day Enterprises is however believed to be in talks with beverage giant Coca Cola for a possible stake sale.
The Coffee Day Group had said it has a total debt of Rs 4,970 crore and it was looking at divesting assets to reduce it.
Shares of ITC fell as much as 2.2% in afternoon trading in Mumbai, while Coffee Day rose 5%, extending its three-day winning streak to almost 16%.
The announcement comes weeks after Coffee Day Enterprises founder VG Siddhartha allegedly committed suicide.
The board of the company, in its meeting held on Thursday, also decided to appoint Siddhartha’s wife Malavika Hegde to ensure that the company continues to have a strategic direction.
With light to the Cafe Coffee Day crisis, corporate debt has grown 65 per cent from Rs 38.8 lakhs crore in 2015 to Rs 64.1 lakh crores in 2019.
It may be recalled that Cafe Coffee Day founder Siddhartha went missing on Monday evening in Mangaluru.
Cafe Coffee Day honcho VG Siddhartha’s death stunned the nation. It has now come to light that there was more to the death than was apparent.
Even before foreign brands penetrated Indian markets, the Cafe Coffee Day (CCD) founder offered an alternative to the tea-drinking youngsters in early 2000s.