When the news of V G Siddhartha, founder of India’s largest coffee shop chain, Cafe Coffee Day, dying by suicide in July 2019 surfaced it shocked everyone in the country.
Many thought that the Coffee Day company would not survive after Siddhartha’s death and questions abounded as to who would continue to run the company after him. People believed the company could not recover because of the accumulated debt. But Malavika Hegde, wife of V G Siddhartha, has shattered all the suspicion and achieved a milestone by saving CCD from disappearing despite being a single woman and mother of two sons.
In December 2020, Malavika took over as CEO of Coffee Day Enterprises Ltd (CDEL). From that day on she worked tirelessly for the growth of the company. In 2019, Coffee Day had a debt of over Rs 7,000 crore. This was a huge burden for Malavika who was in grief after losing her husband. But she never gave up.
According to Times of India: In a letter to the company’s 25,000 employees on July 24, Hegde wrote that she was committed to the future of the company and assured that the Coffee Day story was “worth preserving”. Her letter came hours after a probe revealed that a private entity owned by late founder Siddhartha owed Rs 2,693 crore to the listed entity, Coffee Day Enterprises Limited (CDEL). “We will work to reduce the debt to a manageable level by selling a few more investments as I am committed to the company’s future,” she wrote.
After Siddhartha’s death by suicide, Malavika Hegde managed to reduce his debt even during the COVID lockdown. She had earlier said that the challenges increased but “somewhere along the way in the last 12 months, my mission has been to uphold the proud legacy of Siddhartha. He has left me a job to do, to settle every lender to the best of my ability, to grow the business and to enthuse and foster our employees.”
Malavika Hegde was born in 1969 in Bengaluru, Karnataka. She did her schooling from a local school of Bengaluru (also called Bangalore). She pursued engineering from Bangalore University. Malavika belongs to the Vokkaliga community. Her father, Somanahalli Mallaiah Krishna, is a prominent Indian politician and has served on many important positions such as the Miniter of External Affairs and the Chief Minister of Karnataka. Her mother, Prema Krishna, is a social activist. She has a younger sister, Shambhavi Krishna, who is a businesswoman.
Malavika Krishna Hedge got married to the owner of the popular food chain Cafe Caffee Day (CCD), VG Siddhartha in 1991. They have two sons, Eshaan and Amartya.
VG Siddhartha went missing on 29 July 2019. He was on his way from Bengaluru to Sakleshpur with his driver. In the middle of the journey, Mr. Siddhartha asked his driver to drive towards Chikmagalur. When they were close to Chikmagalur, he asked his driver to stop near a bridge. He stepped out of the car, and he asked his driver to take the car to the end of the bridge and wait for him until he came towards him after a while.
His driver waited at the end of the bridge for an hour, and when he did not return, he called him up, but, his phone was switched off. The driver went back to the spot where he had Left him and searched for him. When he was not able to find him, he called Malavika’s elder son and informed him about it, and then he rushed to the nearest police station and registered an FIR. The police began search operations on 30 July 2019.
On 31 July 2019, at 7:43 in the morning, police found a body in the Netravati River, which resembled VG Siddhartha. His family was called for the verification of the body. Malavika was also one of the people present for the verification. When the verification and the paperwork were done, his body was taken to his office in Chikmagalur. Malavika decided that Siddhartha’s funeral will take place at the coffee estate of Siddhartha’s father in Belur Taluk; as it was the place where Siddhartha decided to be an entrepreneur.
The death of Siddhartha had plunged the company into an uncertain future. It was already dealing with debt and fear of closure.
At this crucial moment, Hegde took the reign as CEO. Reportedly, by March 2021, Hegde brought down the company’s debt from at least Rs 7,000 crore to Rs 1731 crore. This development took place during the pandemic when the country’s economy was already hit hard by the loss of business and many shops had put shutters down forever.
The process of reducing the debt was not magic. It demanded hard work and complete dedication by Hegde. According to Punekar News, the company paid Rs 1,644 crore to its lender. They accepted an amount from US private equity giant Blackstone and sold a stake in Mindtree, which helped in reducing the deficit.
Hegde reportedly entered into a share purchase agreement with reputed companies and was thus able to reduce their debt further in an economic environment where businesses were flopping due to pandemics and lockdowns. Hegde pulled CCD up and continues in her effort to reduce the debt while ensuring the smooth functioning of its outlet across the country and keeping up its competition with other coffee shops like Starbucks, amongst others.
Currently, Cafe Coffee Day (CCD) owns 572 cafes across the country, along with 333 CCD Value Express kiosks. It is a huge business with over 36,000 vending machines serving coffee to CCD customers.
Cafe Coffee Day (CCD), contributed 47 per cent of the consolidated net revenue. Logistics business accounted for 45 per cent of revenue, while the remaining 8 per cent was from logistics.