Thailand’s Cafe Amazon seems prepared to bow out from the local market after a half-decade attempt to square up with local coffee chains. At the forefront of this decision is Central Plaza Hotel Public Company Limited (Centel), who will be stepping away from the Cafe Amazon joint venture in Vietnam. This move indicates a strategic pivot in response to the fierce competitive landscape in Vietnam’s coffee sector.
Centel’s withdrawal implicates the dissolution of the ORC Coffee Passion Group Joint Stock Company (ORCG), the corporation responsible for the operations of Cafe Amazon within Vietnam. ORCG was a partnership between Centel’s indirect subsidiary, Central Restaurants Group (Vietnam), which owns a 40 per cent stake, and PTTOR International Holdings (Singapore), another subsidiary of the publicly-traded Thai firm PTT Oil and Retail Business, with a 60 per cent stake.
In an official statement, Centel underscored the necessity to “realign business priorities” and adapt to the pressing challenges in the market. As of the end of August, the company’s investment in the venture amounted to THB 56 million (US$1.72 million).
This decision marks the end of Centel’s involvement in Cafe Amazon’s expansion into Vietnam, an ambitious initiative that was launched in 2020 with the goal of becoming a top global coffee brand. Unfortunately, the stiff competition from both international and local chains proved to be too daunting.
What is the primary reason for Cafe Amazon’s exit from Vietnam?
Intense competition from local and international coffee chains is the main reason behind Cafe Amazon’s exit from the Vietnamese market.
What percentage of ORC Coffee Passion Group Joint Stock Company (ORCG) does Central Restaurants Group (Vietnam) hold?
Central Restaurants Group (Vietnam), an indirect subsidiary of Centel, holds a 40 per cent stake in ORCG.
When did Cafe Amazon originally plan its expansion into Vietnam?
Cafe Amazon initiated its ambitious expansion into Vietnam in 2020, with the goal of becoming a top global coffee brand.
