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Coffee Day Enterprises hires IDFC Securities for asset sales
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Coffee Day Enterprises Ltd (CDEL), the operator of several companies including retail chain Café Coffee Day, has hired IDFC Securities Ltd as its adviser to explore strategic asset sales to meet its debt obligations.

CDEL in a stock exchange filing said it would work with IDFC to identify its options, including divesting its holdings in Coffee Day Global Ltd and other group companies, except for SICAL Logistics Ltd.

The Bengaluru-based company said that IDFC will also advise on refinancing of existing debt and raising additional facilities to repay debt in CDEL and its subsidiaries.

As the news broke about the IDFC’s appointment, Mint reported that CDEL has hired ICICI Securities as its advisor for potentially selling SICAL, which could raise anywhere between Rs 1,000 crore to Rs 1,500 crore.

CDEL, which has a consolidated debt of Rs 4,400 crore, is planning to sell the promoter stake in SICAL and its assets, Mint added, citing people aware of the development.

Last month, private equity giant Blackstone agreed to acquire the CDEL-owned Global Village Tech Park for an amount between Rs 2,600 crore and Rs 3,000 crore ($365-421 million).

The tech park is spread over 120 acres in Bengaluru with a built-up area of 3.3 million square feet (sq ft). The park has an additional potential of roughly five million sq ft built-up space. It counts among its tenants companies such as Mindtree, Mphasis and Accenture.

The developments come in the wake of the death of Café Coffee Day founder VG Siddhartha, who reportedly died by suicide allegedly under pressure of debt. A letter, purportedly written by Siddhartha, had mentioned an unnamed private equity partner as pressuring him into a share buyback, and “harassment” from tax authorities, among others.

Following Siddhartha’s death, CDEL named non-executive independent director SV Ranganath as interim chairman. At the time, the company said it had also set up a committee vested with the powers of the chief executive to explore opportunities to deleverage the Coffee Day group.

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