Mumbai: The Coffee Day Enterprises hit lower circuit on the BSE during the early trade on Tuesday following reports that V.G. Siddhartha, the company's founder has gone missing.
Siddhartha reportedly went missing late on Monday and is suspected to have jumped off a bridge in Mangaluru. According to reports, a search operation is currently underway while Siddhartha's phone remains switched off.
"This is to inform you that, Mr. V.G. Siddhartha, Chairman and Managing Director of Coffee Day Enterprises Limited has not been reachable since yesterday evening. We are taking the help of concerned authorities. Company is professionally managed and led by competent leadership team, which will ensure continuity of business," the company said in a regulatory filing.
Earlier in a letter to his shareholders Siddhartha had said that "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, a transaction I had partially completed six months ago by borrowing a large sum of money from a friend."
He further said that "there is a lot of harassment from the previous DG Income Tax in form of attaching shares on two separate occasions to block our Mindtree deal and then take position of our Coffee Day shares..."
On the stock movement Mustafa Nadeem, CEO, Epic Research told IANS that this is panic selling and now the ripple effects are seen to its lenders as well. Siddhartha is the son-in-law of former Karnataka Chief Minister S.M. Krishna.
He had recently sold over 20 per cent of his stake in IT company Mindtree to engineering and construction company Larsen & Toubro (L&T) which made way for L&T to acquire Mindtree.