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Coffee Day stares at corporate insolvency over bond defaults


Alternative investment manager Ares SSG Capital Management has filed an application with the Bengaluru bankruptcy tribunal to admit Coffee Day Enterprises for corporate insolvency over its ₹228-crore bond default, people aware of the development told ET. The global fund filed the application through IDBI Trusteeship.

Coffee Day Enterprises (CDEL) informed the exchange about the insolvency application filed by IDBI Trusteeship without naming the bondholder. CDEL is Coffee Day Global’s holding company that operates the Cafe Coffee Day chain.

On March 31, 2022, CDEL had defaulted on ₹115.37 crore of bond payments to Credit Opportunities II Pte and ₹116.55 crore to India Special Situation Scheme, both funds of Ares SSG Capital.

Coffee Day Global was admitted for corporate insolvency by the National Company Law Tribunal, Bengaluru, on July 20 on an application filed by IndusInd Bank. However, the appellate tribunal stayed the process until the next hearing which is scheduled on September 20, as reported by ET on August 11.
According to the people cited earlier, at least three of CDEL’s lenders have sold their debt to different asset reconstruction companies (ARC) after a failed attempt to restructure the company’s debt.


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