Mumbai: Amid a nationwide lockdown in the wake of Covid-19 breakout, American private equity giant Blackstone Group Ltd, on Friday, went ahead to pay Coffee Day Group Rs.1,800 crore -- the first tranche of the Rs. 2,700 crore deal to acquire Coffee Day Group’s Global Village Technology Park.
The money from the sale of the 90-acre tech park on the outskirts of Bengaluru is to be used for repaying the debts of Cafe Coffee Day’s (CCD) associate firms and their promoters. Founder V.G. Siddhartha committed suicide in July 2019.
Coffee Day Enterprises Ltd (CDEL), the flagship of the conglomerate founded by late VG Siddhartha, repaid ₹1644 crore to 13 lenders after concluding Friday’s deal with Blackstone Group to sell its technology business park.
CDEL paid full principal and interest to all its lenders on Friday.
According to a person directly aware of Friday’s transaction, Rs. 497 crore will be repaid to Axis Bank, Rs. 413 crore will be repaid to Standard Chartered Bank, Rs. 199 crore will be rapid to PHL Finvest Pvt. Ltd. (an NBFC subsidiary of Piramal Enterprises Ltd.), Rs. 108 crore will be repaid to Yes Bank, Rs. 81 crore each to RBL Bank and STCI, Rs. 72 crore to Bajaj Finance Ltd., Rs. 60 crore to Kotak Mahindra Investments Ltd., Rs. 38 crore each to Indiabulls and AK Capital, Rs. 22 crore to Aditya Birla Finance Ltd., Rs. 24 crore to IFCI, and Rs. 11 crore to Shine Star.
Mape Advisory was the investment banker for the transaction.
From the Rs.1800 crore that has come on Friday, Rs. 1644 crore will be used for repaying debts and the rest will be retained by the company for continuing its operations amid the slowdown.
On Thursday, CDEL said on exchanges “Due to complete nationwide lockdown declared by the Government of India, all our outlets are closed and offices are shutdown with the instruction to Work From Home."
On 6 September, CDEL announced its agreement to sell the tech park to Blackstone—a deal that was crucial for the group.
However, among more than a dozen lenders, Yes Bank, which is the single largest lender to the group and has been dealing with its own liquidity crisis, was reluctant to approve the deal.
Yes Bank has been the single-largest lender to the group and its promoters, with an exposure of at least Rs.1,500 crore.
Last month, Yes Bank gave its conditional nod to the deal, following which Blackstone paid Rs. 200 crore to Coffee Day Group.
“The rest Rs.700 crore, which is the second tranche, will come within the next six months," said the person cited above.
With Friday’s repayment, CDEL’s debt would come down to ₹3,100 crore from ₹4,900 crore earlier. The company, which runs Cafe Coffee Day through a subsidiary, has been paring debt through sale of non-core assets.
The group sold its entire stake in software firm Mindtree Ltd to Larsen and Toubro Ltd for Rs.3,200 crore in May, using part of the money to pay off debts.