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CCD founder VG Siddhartha goes missing, days after his ‘letter’ talked of failure

Massive search operation on to find V.G. Siddhartha who went missing near Mangaluru.

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Bengaluru: Cafe Coffee Day (CCD) founder and owner V.G. Siddhartha was Tuesday reported to have gone missing from close to Mangaluru, three days after he purportedly wrote a bleak letter to the company board.

Siddhartha, the son-in-law of former Karnataka chief minister S.M. Krishna, was headed from Bengaluru for Sakaleshpur late Monday but on the way, asked his driver to go towards Mangaluru, according to the police.

On reaching a bridge over the Netravati river in the Kotepura area in Dakshina Kannada district, he got down from the car and told his driver that he was going for a walk.

“He (Siddhartha) asked the driver to wait till his arrival. When he did not return even after two hours, the driver approached the police and lodged a missing complaint,” deputy commissioner of Dakshina Kannada district Senthil Sasikant Senthil told PTI.

More than 200 policemen and divers on about 25 boats were carrying out searches for him.

The deputy commissioner said sniffer dogs have also been pressed into service.

“The help of local fishermen is being taken in the search. We are checking who all he spoke to over phone,” Mangaluru police commissioner Sandeep Patil said in a message.

In Bengaluru, chief minister B.S. Yediyurappa visited Krishna’s residence and held discussion with the family members. Senior Congress leader D.K. Shivakumar also visited Krishna’s residence.

In a statement, the company said it is “professionally managed and led by competent leadership team, which will ensure continuity of business”.

Siddhartha’s purported letter to CCD board

The news of the Cafe Coffee Day founder’s going missing comes days after he purportedly wrote a letter to the company’s board, in which he reportedly said he failed to “create the right profitable business model despite my best efforts”.

In the letter dated 27 July, as reported by CNN-News18, V.G. Siddhartha said he 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”.

He added that he was under tremendous pressure and harassment from I-T officials.

In March 2019, Siddhartha sold his entire stake in IT firm Mindtree to L&T for close to Rs 3,000 crore.

“I am solely responsible for all mistakes. Every financial transaction is my responsibility. My team, auditors and senior management are totally unaware of all my transactions,” he reportedly wrote in the letter. “My intention was never to cheat or mislead anybody, I have failed as an entrepreneur.”

Sources in the company said they are shocked with the news of him gone missing.

“After the Mindtree stake sale, Siddhartha was trying to resolve the business issues with all eagerness and was trying to get his business back on track. But there is no update on why he would go missing,” said an employee who didn’t wish to named.

Shares of Coffee Day Enterprises slumped as much as 20 per cent to Rs 153.40 in Mumbai trade Tuesday, their lowest level on record. The broader S&P BSE Sensex index was up 0.3%.

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 CCD.

Siddhartha was seeking a valuation of as much as Rs 8,000-10,000 crore from Coca-Cola Co. to sell a stake in the coffee chain, The Economic Times reported last month.

The coffee baron

V.G. Siddhartha, also known as the coffee king of India, runs India’s largest coffee chain in CCD, and owns Asia’s single largest coffee estate.

A native of Chikkamagaluru in Karnataka, Siddhartha comes from a family of coffee growers. Known to have been a reluctant businessman with a passion to join the Indian Army, Siddhartha had chalked his career as an investment banker soon after completing his masters degree from the Mangaluru University.

In 1984, Siddhartha launched his own investment and venture capital company called Sivan Securities. With the profits from his newly launched company, he began expanding his family coffee business.

By 1996, he launched Cafe Coffee Day’s first outlet on Brigade Road in Bengaluru. At a time when the city was booming as IT capital and the lifestyle of people largely revolved around a cup of tea, launching a full-fledged coffee shop was nothing less than a gamble, Siddhartha had told this reporter in the early 2000s.

The coffee day chain caught the eye of the young generation and began the “coffee shop” culture in the country. CCD became a household name after his outlets began serving across several cities in India.

As of March 2019, CCD had 1,752 cafes in India and revenue of Rs 1,814 crore in 2018-19, according to regulatory filings.

— With inputs from PTI and Bloomberg.

Also read: Everyone wants fancy coffee, but the farmers growing it are in crisis


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