Coffee Day Enterprises to sell its Bengaluru tech park to Blackstone for up to Rs 3,000 crore

The announcement comes weeks after Coffee Day Enterprises founder VG Siddhartha allegedly committed suicide.

Published: 14th August 2019 06:29 PM  |   Last Updated: 15th August 2019 07:51 AM   |  A+A-

Global Village Tech Park in Bengaluru

Global Village Tech Park in Bengaluru

Express News Service

NEW DELHI: In a bid to help pare its debt pile after the alleged suicide of its founder VG Siddhartha, the Coffee Day Enterprises’ board has decided to sell its 3.3 million square feet technology park in Bengaluru to US-based private equity firm Blackstone for about Rs 3,000 crore. 

“The Board of Directors approved the disinvestment of Global Village Tech Park in its subsidiary, Tanglin Developments Ltd, in favour of Blackstone. The transaction value is about Rs 2,600-3,000 crore and the company has entered into a non-binding letter of intent,” the company said in a regulatory filing on Tuesday.

Officials said the deal was executed through a special purpose vehicle where Blackstone and Salarpuria Sattva have jointly bought the coffee chain’s asset in which the latter is likely to hold around 10-20 per cent stake. “Both parties have signed a non-binding letter of intent and the deal is expected to be completed in 45 days,” said a person aware of the deal.

As per regulatory filings, the total debt of Coffee Day Enterprises stands at Rs 6,547 crore, which includes loans from banks and securities sold to mutual funds. Sources said Blackstone-Salarpuria had approached the group to buy the technology park earlier too, but the move had been put on hold as Siddhartha was negotiating sale of his flagship coffee chain to potential buyers such as  ITC and Coca-Cola.

The Coffee Day board on Tuesday also gave in-principal approval for disinvestment in its step-down subsidiary, AlphaGrep Securities Pvt Limited, to Illuminati Software Pvt Ltd for nearly Rs 28 crore. “The board takes the opportunity to thank Blackstone for their quick turnaround time displayed under adverse market conditions. All these transactions will significantly help in deleveraging the Coffee Day Group,” the company said.

Blackstone Group LLP is the largest investors of commercial property portfolio in India with over 56 million sq ft portfolio. It owns India’s biggest portfolio of income-producing office assets, totalling over 31million sq ft across key property markets of Noida, Mumbai, Pune and Bengaluru. 

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp