Coffee Day Enterprises Limited (CDEL), whose long-term rating has recently been downgraded to ‘D’ by credit rating agency ICRA, is “deleveraging its assets” for debt reduction and to ensure liquidity position for the company.
Earlier, this week, ICRA had downgraded CDEL long-term rating to ‘D’ with negative outlook from ‘BB+’ (Negative) based on ₹315 crore term loans.
“The rating action follows the delay in debt servicing by CDEL’s flagship subsidiary - Coffee Day Global Limited and Sical group of companies. The Company is in the process of deleveraging its assets to ensure liquidity position for the company,” said CDEL in a regulatory filing.
Sical Logistics on Thursday said it has an external debt of ₹1,488 crore, secured by the personal guarantees of late Coffee Day Group promoter V.G Siddhartha.
The Coffee Day Group company, which runs port terminals and container freight stations, was working on “strategic alternatives” to deleverage the company.
Siddhartha’s body was found in the Netravati river in Dakshina Kannada district of Karnataka on July 31, a day after he went missing.
Since Siddhartha’s death, CDEL has been trying to divest its assets to pare debt. Recently, CDEL’s board of directors approved the sale of its Global Village Technology Park in Bengaluru to Blackstone for up to ₹3,000 crore.
