Coffee Day gets Rs 2,000 crore from Blackstone for IT park deal

Bengaluru: Coffee Day (CDEL) has received Rs 2,000 crore from Blackstone as part of the deal to sell its IT park in the outskirts of Bengaluru. This is the first tranche of the transaction, out of which Rs 1,650 crore would be used to repay banks and other financial institutions. The remaining Rs 700 crore would be given to the company by the end of the year.
Out of the Rs 1,650 crore, Rs 900 crore would be used to repay Axis Bank and Standard Chartered Bank while another Rs 199 crore and Rs 108 crore will be paid to Piramal Housing and beleaguered Yes Bank respectively. Incidentally Yes Bank was the last to issue a no objection certificate for the deal, which was approved by the board in September.
People familiar with the deal said none of the banks has taken a haircut on their debt and CDEL paid full principal and interest to all the lenders on Friday even as the economic activity and credit markets have reached a grinding halt following the Covid crisis. The deal will help the company, which runs the Café Coffee Day chain, reduce its debt to Rs 3,100 crore from Rs 4,900 crore.
The IT park, Global Village Tech Park in the outskirts of Bengaluru, is a 4 million sqft tenanted office space located on a 120-acre campus and counts Accenture, Mphasis among its tenants besides having the headquarters of Mindtree.
Blackstone and Salarpuria Sattva have jointly purchased the park which is part of Tanglin Developments. CDEL has been scrambling to reduce its debt ever since its founder VG Siddhartha committed suicide last year citing pressure from lenders.

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