Shares of Coffee Day Enterprises climbed 5% on Friday to the intraday high of Rs 45.85 on BSE, after media reports suggested that private equity firms were interested in buying a lumpsum stake in CDEL's coffee business.
Following the development, the share price of Coffee Day Enterprises rose 4.92% to the intraday high of Rs 45.85 on BSE against its previous closing price of Rs 43.70.
Volume-wise, 2.7 lakh and 5 lakh shares changed hands on BSE and NSE counters, respectively.
Coffee Day Enterprises Ltd has reportedly signed non-disclosure agreements with private equity firms KKR, TPG Capital and Bain Capital for initiating discussions on a significant stake sale.
Sanjay Nayar, CEO of global investment firm KKR, had resigned from the board of Coffee Day Enterprises (CDEL) on November 11, in view of the negotiations. KKR, one of the largest foreign PE investors in CDEL currently holds a private equity stake of 6.07%, according to BSE.
Louis Dreyfus Company BV, a Dutch agro commodity, shipping and finance firm, is also expected to join the race.
CDEL's board is expected to speed up talks with interested investors once former CBI official Ashok Kumar Malhotra submits investigation report. The company's board had assigned Malhotra an investigation into the circumstances leading to former Chairman VG Siddhartha's death and the statements made in his purported letter.
The cafe chain operator had appointed IDFC Securities in September 2019 to evaluate strategic options for divestment and raising additional funds to repay debt. Strategic options include divestment of stake in Coffee Day Global and other group company, excluding Sical Logistics, as per the regulatory filing by the company.