[AltoLXI]

Cafe Coffee Day founder VG Siddhartha goes missing.

V G Siddhartha, founder-owner of Cafe Coffee Day outlets and son-in-law of former Chief Minister S M Krishna, who went missing was suspected to have committed suicide by jumping into Netravati River in Ullal on Monday midnight.

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In a letter reportedly written by Siddhartha to his family before he went missing, he said he had “failed to create the right profitable business model despite my best efforts”. He added, “I would like to say I gave it my all. I am very sorry to let down 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….”

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[aargee]

OMG!! What a sad news!! I'm reminded of this...


Despite having some not so good experiences offlate across few branches, the brand value hasn't come down as such nor calling for suicide. I'm sure if he could've stayed strong a little more stronger, he could've witnessed even better days. But yes, who knows what's going on with other's lives & what we would've done if we were in his place?

Really bad news & totally unbelievable!! Hopefully the whole thing is a drama

[deehunk]

This is a sad development, but the genuinity of his business model being clean is debatable. He has accused a former DG-IT of constant harassment, this should be thoroughly investigated. The complaints of bullying people through IT raids is not a hidden thing, but the nature of these selective raids has been questionable. I am not confident that this person will get justice. He should have fought instead of taking hasty decisions. I pray to god, let him be alive.

[paragsachania]

As someone who was born and brought up in and around Coffee Land, there is nothing more shocking than this news. While we grew up from kids as adults, even before learning about VG Siddhartha, we had developed so much respect for this father Gangaiah Hedge who was the trustee of our School in Belur and used to visit the School every week and enquire about its functioning and interact with us kids.

Most of our School Picnics have happened at their estate home where they belong to which was less than 20 km from my hometown of Belur. His Father as an active Rotarian would visit Belur every tuesday where we saw him being driven around in a normal M&M Jeep or a M&M Commander and him getting down to buy groceries at a shop nearby.

With father being this humble, it was never a surprise that his son Siddhartha would also grow up like one and he almost did. He too had humble beginnings where he stepped out of Mountain View College in Chikmagalur to start a business with very less money borrowed from his Dad.

Amalgamated Bean Coffee Trading Company, popularly known as ABC became a synonym with Coffee planters around the Malnad region here with a lot of my friends and classmates dealing with ABC to sell their annual coffee yield. At one point in time in 2000s, it was also said that ABC began controlling India's Coffee Industry indirectly by ensuring to make prompt payments to the growers' yield even if it meant that you were paid little lower than the market price. A lot of small time coffee agents during and after the coffee boom (in 1999-2000) also went bankrupt and few committed suicides too. It was here where ABC became a trusted brand among the growers that in years to come, ABC acquired nearly every Coffee Curing unit in whole of Hassan, Sakleshpur, Mudigere, Belur and Chikmagalur belts.

Ask any coffee planter today and at least 9 out of 10 would admit trusting CCD to sell their yield than anyone else due to assured payments.

I would also like to add that Siddhartha has been responsible to employ so many of youths from this region as he always wanted to help them. Needless to say that a lot of my classmates are still employed with CCD (Formerly ABC) while one of them who studied with me for 12 years is the GM for their Human Resources and with CCD for past 17 years.

My Dad's brother too had his stint for nearly 15 years at their Furniture Manufacturing unit called DAFFCO (Dark Forest Furniture Company) at Chikmagalur where all the furniture for their CCD outlets, Resorts (Serai), School (Amber Valley) was designed and manufactured. DAFFCO wanted to venture beyond this, by supplying furniture to bigger brands.

Most of us at home woke up to this news this morning and I soon called my uncle in Chikmagalur to ask about it and he did give me certain inputs that made me believe that all was not well with CCD. Shrinking orders at DAFFCO, reduction of workforce at his parent unit in Chikmagalur were few hints. And later, the letter written was shown all over in the media that confirmed a lot beyond what he just said.

With so many positive memories of this family and seeing it all right from my School days till now, I feel very miserable to learn something like this and I too pray that he comes out alive and fight rather than give up like this. Their family has been one of the most respected ones in our region even before ABC or CCD was born.

[deehunk]

Thanks Parag for sharing valuable information about Siddhartha, the name of former DG-IT is now out in public.The same person has been accussed of orchestrating selective IT raids from 2014. The role of other investors in SIddartha's real estate business too should be investigated. I was watching news, his friend told that this road going towards Kasargod is very busy around 8pm. So is this really the place of incident or a ploy to divert the investigation? The missing mobile phone is making me to believe that it is a ploy, why a person committing suicide would carry the phone with him?

[paragsachania]

Originally Posted by deehunk

I was watching news, his friend told that this road going towards Kasargod is very busy around 8pm. So is this really the place of incident or a ploy to divert the investigation?

The investigation confirms mobile phone signal going dead/untraceable right at the center of the Bridge. The Dog squad too confirmed the sniffer dog(s) following till halfway and stopping right there. This is as per the Kannada media channels I was watching a while before.

The road for sure is busy and its not even that far from Pumpwell circle that is a major entry/exit point for Mangalore from South and East but the driver confirmed that he was asked to park beyond the bridge while he would come walking and prior to this the driver senses tensed conversation that Siddhartha was indulged in before he got down.

[AltoLXI]

The letter that was reportedly written before he went missing.

[CrAzY dRiVeR]

The man was once ranked 75th in the India Rich list published by Forbes magazine. Sad to see him end his life (as suspected) for the lack of money. Wealth is such an illusion!

[srishiva]

In his letter he mentions the assets being more than the liabilities. Why take such an extreme step in that case ? You can always make a fresh start given the connections he has. I think there might have been something more than just the health of his finances looking at the letter. Very sad to hear the news.

[fordday]

I don't understand this. Just three months ago he sold his MindTree stake to L&T for 3300 crores and made a profit of 2800 crores in the sale, as per reports.

How can one say he killed himself because of lack of finances.
Moreover CCD is a not a private firm but publicly listed company and though he is the main promoter there is a board who are equally responsible for running it.

His father in law is with the present political setup which makes it doubtful that some officer can harass him to drive to suicide.

[paragsachania]

Originally Posted by fordday

I don't understand this. Just three months ago he sold his MindTree stake to L&T for 3300 crores and made a profit of 2800 crores in the sale, as per reports.

Why were those shares sold and what were these funds for is something we will not know.

At the same time, he had asked Coca Cola to valuate CCD and that didn't yield fruitful results (undervalued).

The letter also claims that he had transactions that only he is aware and not even his family knows about it. So, there is a lot more than just the usual topics we know about through the media. Till things are out in open (which I really doubt) we can keep speculating and arbitrarily keep pointing towards various aspects.

[deehunk]

Originally Posted by srishiva

In his letter he mentions the assets being more than the liabilities. Why take such an extreme step in that case ? You can always make a fresh start given the connections he has.

Exactly Parag, the assest value is always disastrous when you want to sell, people take advantage of your precarious position. He had to face allegations of encroachment and suspicious land deals because of his connections. It is tough to analyse what was going through his mind, someone very close has backstabbed him.

[am1m]

Not normally one to have much sympathy for the uber-rich and politically connected (quite the opposite in fact), but from most reports and from what paragsachania has posted of his personal experiences, this gentleman seems to have been a decent man. His last letter taking all the blame also seems like something very different from the normally 'crooked-megalomaniac-CEO-type' that is all to common these days.

Doubt the general public will get to know everything, but from all accounts it seems like the CCD brand was pretty much debt-ridden. From personal observations too, I always wondered how the Coffee Day outlets could possibly be making any money. Of course their main revenue was probably wholesale marketing of coffee beans and associated products, and the outlets were probably meant more for branding than for anything else, but it's literally been a decade or more since I've seen a Coffee Day that seemed to have more than a few customers. Travelling around the country, have seen CCD outlets in so many locations, even in some places where we never expected to see one (like Darjeeling, Gangtok and Palolem). All in prime locations, all relatively big spaces, and all quite empty. I guess only the highway outlets see some business and probably mainly because people stop to use the restrooms. With the entry of boutique coffee outlets and more glamorous brands like Starbucks I guess the situation was getting worse.

[pramodkumar]

Here is a well explained series of events that happened.

https://www.youtube.com/watch?v=PDVJzaxwO8w

Pramod

[Samurai]

Originally Posted by srishiva

In his letter he mentions the assets being more than the liabilities. Why take such an extreme step in that case ?

Assets that don't generate income, will generate liabilities in upkeep cost. Let's say you own a flat where you don't live, and are unable to rent for some reason. Yet, you have to pay maintenance, pay minimum electricity bill, pay property taxes, and regularly get the flat cleaned. And you are not able to sell because of lack of demand. So you keep spending money without any returns.

Now imagine you have 1000 such flats... That is how asset rich businesses can find themselves in such situations.

Of course, you are right that he didn't need to commit suicide. He could have come clean and let the bankruptcy process take over. Just like Ramalinga Raju of Satyam did long ago. But we don't know all the reasons VG Siddhartha had.