Coffee Day Enterprises names S V Ranganath interim chairman

New Delhi: Coffee Day Enterprises on Wednesday named independent director S V Ranganath as the interim chairman of the company to replace its founder V G Siddhartha, who has been confirmed dead days after he went missing. The company board, wherein Siddhartha's wife Malavika Hegde is also a director, met on Wednesday to put in place a working structure of the company.

The board has also appointed Cyril Amarchand Mangaldas as its legal counsel to advise on these matters. The board appointed "S V Ranganath as the interim chairman of the board" and "Nitin Bagmane as an interim chief operating officer (COO) of the company," Coffee Day Enterprises, which runs India's biggest coffee chain CCD, said in a regulatory filing.

It also constituted an executive committee comprising Ranganath, COO Nitin Bagmane and CFO R Ram Mohan "to exercise the powers previously vested with the Chief Executive Officer of the company and the Administrative Committee constituted by the Board in 2015," it said.

"The board will, in due course, prepare a detailed charter of authorities vested in the Executive Committee and approve the same," the filing said. The Executive Committee will explore opportunities to deleverage the Coffee Day Group, it said.

The body of Siddhartha, who had been missing since Monday evening, was found on Wednesday in the Netravati river in Dakshina Kannada district of Karnataka after 36 hours of intense search, officials said. Siddhartha purportedly wrote a letter indicating he was anxious about pressure from banks, investors and the tax authorities before he went missing.

"The board took cognizance of statements in the purported letter from V G Siddhartha relating to financial transactions outside the knowledge of the senior management, auditors and the board.

"While the authenticity of the letter is unverified and it is unclear whether these statements pertain to the company or the personal holdings of V G Siddhartha, the board took serious note of the same and resolved to thoroughly investigate this matter," the filing said.

The board expressed its condolences to Siddhartha's family and resolved to lend its support and expressed full confidence in the company's management team.

"The board also took note of a message from Malavika Hegde expressing support and trust in the company's professional team and the common effort to look after the interest of the employees and all other stakeholders," it said. "The board remains deeply committed to safeguarding the interests of all stakeholders, including investors, lenders, employees and customers."

The company said the Audit Committee and Executive Committee will engage in discussions with the statutory auditors of the company and such other advisors as may be necessary with a view to recommend appropriate next steps to the board at its forthcoming meeting on August 8.

Meanwhile, industry captains on Wednesday paid rich tributes to V G Siddhartha, founder of India's biggest coffee chain Cafe Coffee Day, remembering his entrepreneurial spirit and humble nature but also cautioned entrepreneurs not to let failures destroy their self-esteem. Industry leaders such as Kiran Mazumdar Shaw of Biocon, automobile czar Anand Mahindra, Paytm's Vijay Shekhar Sharma, Sachin Bansal of Ola and IT honcho C P Rupani remembered Siddhartha as a "humble and soft speaking" man.

The body of the Cafe Coffee Day founder was found on Wednesday in the Netravati river in Dakshina Kannada district of Karnataka after 36 hours of intense search. In a tweet, Biocon Chairperson and Managing Director Kiran Mazumdar Shaw said, "My deepest condolences to VG Siddhartha's widow Malavika and his sons and to Shri & Smt SM Krishna and family. RIP."

Embattled liquor tycoon Vijay Mallya said Siddhartha was an "Excellent human and brilliant entrepreneur". However, Mallya added that he was "devastated with the contents of his letter". "The Govt agencies and banks can drive anyone to despair. See what they are doing to me despite offer of full repayment. Vicious and unrelenting," he tweeted.

Siddhartha had in a purported letter written by him indicated that pressure from banks, a private equity investor and tax authorities drove him to end his life. Karti P Chidambaram, son of Congress leader and former finance minister P Chidambaram, who is facing ED probe in the Aircel Maxis case, said the government agencies are the biggest impediments to ease of business.

"Managing the systematic harassment by the State n it's pliant agencies is the biggest challenge. IT, ED, CBI, ROC etc are the biggest impediments for ease of business," Karti said. Meanwhile, Mahindra Group Chairman Anand Mahindra said entrepreneurs must not allow business failures to destroy their self-esteem.

"I did not know him & have no knowledge of his financial circumstances. I only know that entrepreneurs must not allow business failure to destroy their self-esteem. That will bring about the death of entrepreneurship," said Mahindra. Paytm founder Vijay Shekhar Sharma tweeted that he was "saddened beyond words." Flipkart co-founder Sachin Bansal said that Siddhartha was an "inspiring entrepreneur and investor". "I had known #VGSiddhartha personally and was always amazed at his energy and positivity," Bansal added. Tech Mahindra MD and CEO CP Gurnani, while saluting his entrepreneurship, said it was a "Very sad day".