Coffee Day Enterprise Co., Ltd. (CDEL) has negotiated ₹The Rs 205 crore settlement with ARES SSG Capital Management will be paid within three years after the National Court of Companies Legal Appeals (NCLAT) put a bankruptcy lawsuit on hold for operators of coffee chain coffee day on February 27.
Part of the settlement depends on certain parameters of the coffee chain that are related to interest, taxes, depreciation and amortization (EBITDA) over the next three years, two people familiar with the matter said.
CDEL told the exchange on Monday that the company’s board of directors has approved it ₹2.05 million for IDBI trustees.
Solution breakdown
IDBI manages two ARES SSG Capital Management Funds – the Indian Opportunity Fund and the Indian Special Situation Fund. This solution ₹The amount of 205 million includes “12.41% of the realized sales of the loan shares and the shares of Aid Coffee Day Co., Ltd., which is sold by the lender to a third party ₹The company told the exchange on Monday that it had $5.5 billion.
Although CDEL’s board of directors approved the settlement in principle, the company is expected to sign an agreement with ARES Management later this week.
“Initial payment ₹The agreement shall be signed with a fee of 800 million, including ₹The lender sold and cited shares of the stock for $5.5 billion. sum ₹$7.5 billion will be paid within one year of the settlement. The last batch will be paid in order to implement certain parameters. ”
The last batch of the second person ₹Coffee Day’s 500 million hinges have achieved higher EBITDA milestones worldwide, and CDEL has surpassed a certain share price in the next three years. Coffee Day Enterprises Co., Ltd.’s inventory increased by up to 5%, close ₹After the news of the settlement broke, there was 24.54 on BSE.
If the group does not meet two parameters, the last batch will drop and it will only pay for ARES SSG ₹A total of 1.55 million.
Ares Management did not immediately respond to a request for comment on Tuesday.
Recovery path
The agreement ended the bankruptcy process against the Coffee Day business, which IDBI custodian launched after the company defaulted on the contract ₹22.8 billion loan.
In March 2019, IDBI Truckeship managed two ARES SSG capital management funds, subscribed to 1,000 non-transferable bonds through private placement, investing in ₹1 million. At that time, the company was called SSG Capital Management. It was taken over by Ares Management in 2022, and its Asian division has since been named Ares SSG Capital Management.
CDEL defaulted on coupon payments between September 2019 and June 2020. On July 28, 2020, IDBI Hosting issued a default notice to CDEL, and later filed a bankruptcy filing, resulting in NCLT’s admission of the case in August 2024. This is the NCLAT’s CDEL challenge to the NCLAT, which was found in the NCLT last month. Since then, ARES and CDEL have negotiated privately to reach a settlement.
As the loan is settled, the group will leave total debt ₹10.68 million. “Most of this debt – end ₹“The negotiations are expected to be conducted with several asset reconstruction companies through CDGL,” the second person said.
One of India’s earliest coffee chains, Coffee Day fell into crisis after its founder VG Siddhartha died of suicide in July 2019, leaving behind a coffee business, ₹The debt is 72 billion. The company has since cut its debt by selling non-core assets and restructuring of loans.
