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Insolvency proceedings against Coffee Day Enterprises : The Corporate Disputes Tribunal (NCLT) has ordered the initiation of insolvency proceedings against Coffee Day Enterprises Limited (CDEL), the parent company of the Coffee Day Group. The Coffee Day Group operates the Cafe Coffee Day chain of coffee houses.

Petition claims default of Rs 228.45 crore

On August 8, the Bengaluru bench of the National Company Law Tribunal (NCLT) admitted a petition filed by IDBI Trusteeship Services Ltd (IDBI TSL) claiming default of Rs 228.45 crore and sought appointment of an interim resolution professional to look after the operations of the debt-ridden company.

1,000 NCDs were subscribed

CDEL owns and operates a resort and is in the business of coffee beans along with providing consultancy services. CDEL had defaulted on coupon payment of redeemable non-convertible debentures (NCDs). The financial lender had subscribed to 1,000 NCDs through private placement and paid Rs 100 crore for the subscription in March, 2019.

For this, CDEL entered into an agreement with IDBI TSL and agreed to appoint it as the debenture trustee for the debenture holders. However, CDEL defaulted in paying the total coupon payments due on various dates between September, 2019 and June, 2020. As a result, the debenture trustee issued a notice of default to CDEL on July 28, 2020 on behalf of all debenture holders and approached the NCLT.

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