Founder of India's largest coffee chain confirmed dead due to debt pressure

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V.G.Siddhartha, the founder of India's largest coffee chain, was found dead after he reportedly left a letter a few days ago saying he was overwhelmed by pressure from banks, investors and tax authorities.

Hidatta told the driver that he wanted to go for a walk by a bridge near the southern Indian city of Mangaluru on Monday (29th) and did not return to the car that night. The city's police department announced today that Hidatta's body had been found, but did not elaborate on the case.

The Coffee Day Enterprises company Hidatta founded released a letter said to be to the board and employees yesterday that he was overwhelmed by the environment, pressure from the lending bank and a company's private equity partner, and harassment by tax officials.

He said in the letter that a private equity partner had been forcing him to buy back shares in the company, and that pressure from banks had led to a "severe liquidity crunch."

The share price of Coffee Day fell by the limit of 20% yesterday and today, when the Coffee Day stock may be shorted and confirmed to be dead. Coffee Day went on sale in 2015, nearly 20 years after its start-up, and there were signs that he and the company were in financial crisis before Hidatta was worried about debt problems.

According to the filing, Hidata and other coffee day co-founders mortgaged a total of 76% of his shares, and the debt burden forced him to start selling his other assets this year. Last month the local economic times reported that he hoped to sell Coca-Cola a stake in Coffee Day valued at $1.45 billion.

Coffee Day has 1700 stores in India, ten times more than Starbucks' strongholds in India.

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