Coffee Day Enterprises Ltd., which owns and operates the Cafe Coffee Day chain, on Monday (March 17) said it has entered into an agreement to repay ₹205 crore due to two debenture holders. The repayment will be made in three installments, including the proceeds from the sale of 12.41% of pledged and exercised shares of Coffee Day Global Ltd to a third party for ₹55 crore.”The company has negotiated and agreed to settle the outstanding debt of two debenture holders for an amount of ₹205 crore payable in three installments, including the proceeds from the sale of 12.41% of pledged and exercised shares of Coffee Day Global Ltd. owned by the company to a third party for ₹55 crore,” Coffee Day Enterprises said in a regulatory filing.The company’s audit committee and board approved the draft settlement agreement on March 17, 2025. The move is part of CDEL’s comprehensive debt reduction strategy, reinforcing its commitment to financial stability and long-term stakeholder value.”The settlement enshrines the debt reduction commitment of the company and its subsidiaries in the interest of all stakeholders. The company remains committed to meeting its obligations and ensuring long-term value creation for stakeholders,” it said.Coffee Day Enterprises has been in trouble since the death of its founder, VG Siddhartha, in July 2019. It has been reducing its debts through asset resolution and has substantially scaled down its operations.Shares of Coffee Day Enterprises Ltd. closed at ₹23.38, down ₹1.21 or 4.92% on the BSE.Cafe Coffee Day (CCD) is an Indian multinational coffee shop chain headquartered in Bengaluru, Karnataka. It is a subsidiary of Coffee Day Enterprises Ltd. Internationally, CCD has a presence in Austria, the Czech Republic, Malaysia, Nepal, and Egypt.V. G. Siddhartha started the cafe in 1996 when he created Coffee Day Global, the parent company of the Coffee Day chain of stores. By 2011, it quickly expanded to other cities in India, opening over 1,000 cafes across the country.On 29 July 2019, Siddhartha went missing, and his body was found two days later in the waters of the Netravati River dam. An alleged letter from Siddhartha to the board of directors and employees was made public, in which he took responsibility for not being able to create a profitable business model. Coffee Day Enterprises appointed Malavika Hegde as the chief executive officer (CEO) from 7 December, following VG Siddhartha’s death.In September 2019, the company appointed auditing firm Ernst & Young to audit its accounts. He also hinted that auditors would look into the founder’s last letter.In March 2020, Coffee Day Enterprises Ltd. announced that it was selling a 90-acre park in Bengaluru for a total sum of ₹2,700 crore to pay off debts of Cafe Coffee Day and its founders.Talking on this topic, Lakshit Jain, an equity analyst, said, “Coffee Cafe Day has been in trouble since 2019, and its debt reduction strategy has continuously hampered its operation. Due to the additional burden of paying off debt and the crunch of operating capital, the company’s size is reducing continuously, and this will additionally reduce cash inflow. Hence you could say that the company is stuck in a vicious debt trap that pulls it deeper into financial crises.”
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