CCD (Café Day Global) the impresario of the most voguish café chain Café Coffee Day, has entered bankruptcy proceedings.
pic credit: Wikipedia
The burgeoning occurred as IndusInd bank filed a plea with National Company Law Tribunal (NCLT).
The Bangalore chapter of NCLT has revealed Café Day Global for the corporate insolvency process following a collapse of negotiations between the CCD and IndusInd bank.
However, CCD has not officially confirmed the rumors or denied the bankruptcy.
NCLT Appoints Legal Team for Bankruptcy Proceedings
Skanda Legal and Tatva Legal have been appointed as advisers for the respondent and applicant in this case, as per NCLT’s official record.
SEBI Imposes Rs 26 Crore Fine for Fund Diversion, Latest Reports Reveal Outstanding Debt to IndusInd Bank
In January 2023 this year CCD faced a fine of Rs.26 crore from the market regulator Securities and Exchange Board of India (SEBI) due to fund diversion from a subdivision to a firm related to promoters.
According to media reports stating the annual company report from March 2022, the CCD has arrears of Rs.67.3 crores owed to IndusInd bank.
Café Coffee Day History
CCD is an Indian coffee brand and multinational chain of coffee houses headquartered in Bengaluru, Karnataka.
CCD has also an international presence in Austria, the Czech Republic, Nepal, Egypt, and Malaysia.
Café Day Global is a Chikkamagaluru-based firm that has its own coffee estates of 20,000 acres. Also, it is the largest producer of Arabica beans in Asia, exporting to various countries including the US, Japan, and Europe.
This popular café chain owner Mr. V.G. Siddhartha started the café chain in 1996. The first CCD outlet was set up at Brigade Road, Bangalore on 11th July 1996. Thereafter it expanded to other cities in India, with more than 1,000 café outlets by 2011.
V.G. Siddhartha completed his master’s degree in Economics from Mangalore University and wanted to work as an investment banker in Mumbai.
He also launched his own investment and venture capital firm- Sivan Securities in Bangalore.
He began investing the profits earned from his start-up in buying coffee farms in Karnataka’s Chikkamagaluru region.
V.G. Siddhartha was inspired by leading coffee brands in Germany – Tchibo, and this inspiration gave him the concept to reach out to people and make drinking coffee a vital experience and made him a billion-dollar business.
A consortium led by Kohlberg Kravis Roberts would invest Rs.1,000 crore was announced in 2010
Toppling of Coffee Day Global
V.G. Siddhartha went missing on 29th July 2019. Two days later his body was found in the Nethravathi river backwaters.
A letter, surmised to be written by V.G. Siddhartha sermonizing the board of directors and staff, was publicized in which he takes responsibility for not creating a profitable business.
The company appointed the auditing firm Ernst and Young to audit its books of accounts. The auditor will also look into incidents of the last letter written by Siddhartha and the points he made in it, as said by the company.
CCD is one of the most famous coffee brands in India.