ET Markets
Stock Analysis, IPO, Mutual Funds, Bonds & More

Siddhartha’s disappearance: India Inc honchos hit out at PE firm, I-T sleuths

Some blamed the PE investor and income-tax officers for Siddhartha’s disappearance.

Last Updated: Jul 30, 2019, 03.24 PM IST|Original: Jul 30, 2019, 03.24 PM IST
NEW DELHI: As founder VG Siddhartha’s letter to the board of Coffee Day Enterprises came to light, top honchos of India Inc expressed shock and dismay over what had unfolded.

While some blamed the private equity investor and income-tax officers for Siddhartha’s unfortunate disappearance, others said policy uncertainties were creating lot of a distress for local entrepreneurs.

“Coffee Day Owner Alleged Harassment By Tax Officer In Letter: Report - Such a shocking and sad end to a quiet n unassuming pioneer who started the coffee cafes business ahead of Starbucks in India,” tweeted Kiran Mazumdar Shaw, Chairperson and Managing Director, Biocon.

In a separate tweet, Shaw suspected that the private equity fund manager might have acted like a money lender and seems to have caused unbearable stress for Siddhartha. He sought an investigation into the case.

V Balakrishnan, former CFO at Infosys, said tax disputes have increased disproportionately in last four-five years. “You can talk to any entrepreneur; they can all live in own ideal world and say everything is hunky-dory. Entrepreneurs are seeing a mix of economic slowdown and they are not able to tackle the high leverage of the past. Combined with the regulatory thing, all the three are adding up and that is what is visible from the letter,” Balakrishnan said.

He said shareholders have different pulls and pressures and they may always exert pressure on the management to either perform or do certain things.

“If you are in a very comfortable position, you will be able to handle those. If the situation is bad, people tend to take these extreme steps. It is very unfortunate,” he said.

Meanwhile, a spokesperson for private equity player KKR told ETNow that the firm is deeply saddened by the developments and that the company’s thoughts are with Siddhartha’s family.

The spokesperson said the PE player believed in Siddhartha. While it had sold 4.25 per cent stake in the firm in February 2018, it has not sold any share since February 2018.

KKR Mauritius Pe Investments held 6.07 per cent stake in the company as of June 30, Nls Mauritius held 10.61 per cent stake, Marina West (Singapore) 4.63 per cent and Marina Iii (Singapore) Pte's 1.04 per cent.
Add Your Comments
Commenting feature is disabled in your country/region.

Other useful Links

Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service