Contrary to a long-standing misconception, Prayudh Mahagitsiri does not own a single share in Nestlé (Thailand) Co., Ltd. Instead, he holds a 50% stake in Quality Coffee Products (QCP), a joint venture equally shared with Nestlé (Thailand), specifically to manufacture NESCAFÉ instant coffee.
It’s crucial to clarify that QCP’s role is strictly as an “Original Equipment Manufacturer” (OEM), essentially a contract manufacturer. Under this arrangement, the brand owner (Nestlé) dictates the production under mutually agreed terms—whether for a few months, years, or until the contract is concluded or is renewed by both parties.
Thus, Prayudh is far from being the “NESCAFÉ Kingpin” as widely presumed. QCP’s obligations to Nestlé simply terminate once the contract ends, and if Nestlé elects not to renew, the relationship ceases without recourse for the OEM to force an extension.
For over three decades, since Nestlé entered the QCP joint venture in 1990, the production contract has been extended. The original agreement, lasting 22 years, expired on December 31, 2012.
Prayudh requested a renewal, leveraging the fact that he introduced Nestlé to invest in Thailand and built NESCAFÉ’s number one market presence. Nestlé granted his request by extending the contract by 12 years that ended December 31, 2024. In late 2022, as per the contractual terms, Nestlé notified QCP two years in advance of its intention to terminate the production agreement.
Nestlé further signaled openness to negotiate post-termination, whether for the purchase of QCP shares at a fair price or to provide any other necessary assistance. The intent was a smooth and amicable exit.
It appears, however, that the parties could not agree on the price valuation, leading the Mahagitsiri family to file a lawsuit with the Southern Bangkok Civil Court at the end of 2023. The lawsuit was soon withdrawn, possibly due to issues surrounding the substantial financial guarantee required by the court.
Shortly after, in March 2025, the dispute was brought before the Min Buri Civil Court. The court then issued a temporary injunction preventing Nestlé from manufacturing, outsourcing, distributing, or importing NESCAFÉ instant coffee products in Thailand.
Nestlé’s public statement noted that the injunction was granted without the court hearing its side, and lamented that the court had also not yet considered the ruling from the international commercial arbitration tribunal in the UK. That ruling affirmed Nestlé’s right to terminate the joint venture contract fully in line with all stipulated terms, and found that Prayudh’s lawsuit failed on all counts.
Amid the Min Buri court’s prohibition on Nestlé, the Central Intellectual Property and International Trade Court simultaneously affirmed that Nestlé Thailand remained the exclusive legal user of the “NESCAFÉ” trademark as of April 11, 2025.
Courtroom drama thus continues from multiple fronts. The Min Buri Civil Court has scheduled a hearing on Nestlé’s motion to overturn the preliminary injunction for April 17.
What is clear, however, is that delays in resolving this dispute hurt not only Prayudh or Nestlé—but the entire Thai instant coffee supply chain, an industry worth THB 57 billion a year, from wholesale and retail distributors to small and large stores, and ultimately Thai coffee consumers.
Most critically, the greatest losers could be Thailand’s coffee farmers. Over half the country’s robusta coffee crop is sold to Nestlé. If Nestlé’s operations are to be hampered, where will all this coffee go?
In this NESCAFÉ saga, the real victims could be Thai coffee growers, retailers, and distributors across the kingdom, hurt by this dispute.
According to data from the Department of Business Development of Thailand, the most recently updated financial performance of QCP is as follows:
In 2023, revenue dropped 9.8% despite a marginal rise of 0.3% to THB 3.07 billion.
A year prior in 2022, QCP registered revenue of over THB 17.1 billion, marking a 10.69% year-on-year increase. Despite higher sales, net profit contracted by 8.14% to just over THB 3.4 billion.
In 2021, revenue slipped by 2% to THB 15.4 billion, although net income grew modestly by 0.58% to above THB 3.7 billion.
The total coffee market in Thailand is valued at an estimated THB 60 billion, according to industry data. Home consumption, including instant and three-in-one coffees, accounts for roughly THB 33 billion, while coffee consumed out-of-home is valued at THB 27 billion (source: Euromonitor).
Within the segment, the ready-to-drink coffee market alone is worth THB 24 billion as of 2023 (Tetra Pak Compass). The appetite for coffee remains strong: Thais average 340 cups of coffee per person annually, with the fresh or specialty coffee segment contributing over THB 5 billion.
