VG Siddhartha, CCD founder: 10 things to know

NEW DELHI: , founder of the country‘s largest coffee chain Cafe Coffee Day (CCD), has been missing since Monday night. Siddhartha is the son-in-law of former Karnataka chief minister SM Krishna. He is married to Krishna’s eldest daughter and has two children.

Café Coffee Day founder V G Siddhartha, who has been missing since Monday night, had written a letter to CCD staff. In the letter, which reads almost like a parting statement, Siddhartha mentions about his financial troubles and writes “I am very very sorry to let down all the people who had put their trust in me. I have failed as an entrepreneur.”

Here are 10 things to know about the CCD founder:

1) Police officials have launched a massive search for him. According to his driver, Siddhartha, known as India‘s coffee king, was talking to someone on his mobile phone when he got off from the car and then disappeared.

2) Before this, he apparently wrote a letter to employees and board of directors of CCD, stating: “I would like to say I gave it my all. I am very sorry to let all the people that put their trust in me. I fought for a long time but today I gave up as I could not take any more pressure from one of the private equity partners forcing me to buy back shares, a transaction I had partially completed six months ago by borrowing a large sum of money from a friend.”

3) Siddhartha‘s Mindtree link: In March, Larsen & Toubro (L&T) had acquired 20.32 per cent stake in Bengaluru-based IT service company Mindtree from Siddhartha and his coffee enterprise for around Rs 3,300 crore, marking India‘s first-ever hostile takeover bid in the IT space. The Mumbai-based firm later picked up more shares of Mindtree from the open market to raise its holdings.

4) Siddhartha, once the largest shareholder of Mindtree, decided to cash out after months long wait to carry the founders along as part of a broader merger and acquisition (M&A) deal. It left Siddhartha, who seed-funded and anchored the company as a passive investor for nearly 20 years, to script his own exit plans.

5) In 1999, Siddhartha was roped in by IT veteran Ashok Soota when the founders, including Subroto Bagchi, Rostow Ravanan and KK Natarajan, were putting together Mindtree.

6) Siddhartha, promoter of the Coffee Day Group, and his family has been in the coffee growing business for more than 130 years. The Coffee Day Group has interests in coffee retailing, logistics, technology parks (SEZ and STP scheme), financial services and investments in technology and software companies.

7) The coffee retailing business under the brand CCD is the market leader in India. Siddhartha‘s coffee retail business was expecting to close the year ending March 2020 with sales of about Rs 2,250 crore.

8) The 58-year old first generation coffee entrepreneur hailed from a coffee growing family in Chikmagalur in Karnataka. A post-graduate in Economics, the family is the largest individual coffee planter, owning about 15,000 acres of coffee estates. He opened his first CCD outlet in August 1996 in Bengaluru’s most-visited shopping street, Brigade Road.

9) The chain has grown to 1,750 stores across India along with 60,000 vending machines, besides presence in Austria, Czech Republic and Malaysia.

10) Siddhartha found himself in trouble in 2017 when the Income Tax (I-T) department conducted raids at over 20 locations linked to him. On Tuesday, Coffee Day Enterprises shares tanked around 20 per cent after the CCD founder went missing.

While police have launched a massive search operation to find VG Siddhartha, founder of Cafe Coffee Day, shares of Coffee Day Enterprises tanked as much as 20% with stock touching a 52-week low of Rs 154.05. Siddhartha has been missing since Monday evening. The company in a notification to exchanges assured “continuity of business” by a competent leadership team.

Coffee Day Enterprises — in which Siddhartha holds 32.75 per cent stake, according to data compiled by Bloomberg — is a holding company for several businesses, the most prominent of which is Cafe Coffee Day. It has more than 1,500 cafes across the country. Siddhartha was seeking a valuation of as much as $1.45 billion from Coca-Cola to sell a stake in the coffee chain he set up, The Economic Times reported last month.
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