Coffee Day Enterprises Limited is “deleveraging its assets” for debt reduction and to ensure liquidity position for the firm. CDEL’s long-term rating was recently downgraded to ‘D’ by credit rating agency Information and Credit Rating Agency of India Ltd(ICRA). The rating went from ‘BB+’ (Negative) to ‘D’ based on Rs 315 crore term loans.
The Company embarked on this deleveraging journey after founder VG Siddhartha’s demise on July 31. Recently, the firm’s board approved the sale of its Global Village Technology Park in Bengaluru to Blackstone Group, a private equity firm, for up to Rs 3,000 crore.
“The Company is in the process of deleveraging its assets to ensure liquidity position for the Company,” stated CDEL in a regulatory filing.
According to Bloomberg, media reports have suggested that ITC Ltd might acquire a stake in Coffee Day. It also told to be in discussions to sell off its subsidiary Sical Logistics Ltd.
The Coffee Day Group of India, which runs port terminals and container freight stations, has been working on “strategic alternatives” to pay off the debt of the Company. On Thursday, CDEL’s subsidiary Sical Logistics claimed it had an external debt of Rs 1,488 crore, secured by the personal guarantees of VG Siddhartha.
On Friday, Coffee Day’s shares rose 4.97% to Rs 73.95 each on the BSE while the benchmark Sensex gained 0.82% to end the day at 37,407.36 points.