Chapter 9: The Domino effect

On 31st May 2019, Cox and Kings put out their annual results for the FY19. It revealed INR 620 Cr in cash, the total debt of INR 2000 Cr, and EBITDA of INR 274 Cr; and yet defaulted on the bank debt, cascading into bankruptcy.

Interestingly, PK had signed off on the FY19 annual results. What shocked the public more than the default despite the rosy picture painted by the annual results is the revelation made by Cox and Kings that they had a debt of over INR 5600 Cr – less than a year after PK declared that total debt in the company is only INR 2000 Cr.

Peter Kerkar and Urrshila Kerkar were signing off financial statements of the company for the past ten years and this time was no different – except that they were caught with hands still in the cookie jar.

The forensic report by PWC and the BDO brought to light the extent of fraud and plundering of Cox and Kings for the benefits of its promoters and losses to everyone else – employees, banks, shareholders, and investors.

The bankruptcy had grave consequences for the most vulnerable of the lot – the employees. Employees did not receive their paychecks and around 3,000 employees lost their livelihood.

Left in the streets to survive for themselves, some of them even took up odd jobs such as selling vegetables and such in the streets – all because the promoters went on to party with the funds with no concern for the company or the employees.

Several customers who had paid for their travel bookings were left stranded midway in their holidays as Cox and Kings did not honour its bookings. Some of the customers sued Cox and Kings and there have been cases related to this in the US and Kolkata.

PK thought that he always had one more rabbit to pull out of the hat. And why not – he had, in the past, coaxed, nudged, induced and even threatened people to get his way and he might have thought that this time was no different. However, no bidder came to acquire the brand or the business that is debt-ridden Cox and Kings; demise soon followed.

Cox and Kings lost its IATA license and had to put a sudden halt to its operations causing the loss of over 3000 jobs. Even the visa processing company did not get any suitors despite promises to employees that PK would get BLS or VFS.

Meanwhile, in the UK, things were unravelling fast – Malvern, an eclectic setup funded by Yes Bank, collapsed into liquidation within one month, leaving 350 employees jobless. PK was caught redhanded, but he had some malicious plans to slither his way out of it.

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