InvestorQ : With Coffee Day Enterprises repaying most of its debt, due you see a bright future for the company?
Khushi Patel made post

With Coffee Day Enterprises repaying most of its debt, due you see a bright future for the company?

Answer
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Anjana Aiyar answered.
6 months ago


With the latest tranche coming from Blackstone, a lot of problems of Coffee Day could actually be resolved. Blackstone Group has paid Coffee Day Group Rs.1,800 crore as the first tranche of the Rs.2,700 crore deal to acquire Coffee Day Group’s Global Village Technology Park. This will be largely used the repay the debt of Coffee Day and associate firms. In fact, Coffee Day has already repaid lenders Rs.1644 crore to 13 lenders after the Blackstone deal. There was no negotiation and the entire principal and interest has been paid. Currently, the Coffee Day outlets are shut due to the nationwide lockdown. But the real challenge could come from managing the transition after the unfortunate death of VG Siddhartha. Yes Bank has an exposure of Rs.1500 crore to the Coffee Day group. However, this only reduces the total debt of CDEL from Rs.4900 crore to Rs.3100 crore. It has also sold off its 20% stake in Mindtree. Even after the debt is repaid, the stock may take time to find its footing.