The Mahagitsiri family has faced a setback in its legal dispute with Nestlé, as a court has ruled that the original voting rules in their Nescafé joint venture in Thailand must be reinstated.
Thailand’s Central Intellectual Property and International Trade Court has annulled a temporary injunction previously sought by the family, thereby reinstating the original voting regulations at Quality Coffee Products Co Ltd (QCP), as stated by Nestlé yesterday, July 18. According to these rules, directors from the Mahagitsiri family, who are also shareholders of QCP, require joint approval from Nestlé’s directors to pass resolutions within the QCP board.
The Bangkok South Civil Court is continuing its deliberation on Nestlé’s petition for the dissolution of QCP. The legal conflict centres on disagreements between the parties over the future business strategy of QCP, a matter that has garnered attention from foreign investors.
Nestlé’s statement further detailed that the Mahagitsiri family’s shareholders must submit monthly reports on income, expenses, assets, and liabilities for QCP to the court. This measure aims to safeguard the interests of QCP and Nestlé’s shareholders.
A Nestlé spokesperson has confirmed that production at the QCP factory in Chachoengsao ceased on January 1 and has not resumed. Nescafé products are currently sourced from various production bases, including original equipment manufacturer factories in Thailand. Other Nestlé factories in the country contribute a smaller portion of products using shared production lines to manufacture coffee, reported Bangkok Post.
Additionally, Nescafé products are imported from neighbouring countries like Vietnam and Malaysia. Despite the legal disputes among QCP shareholders, Nestlé assures that there is a sufficient supply of Nescafé products for distribution across Thailand, maintaining the same taste and quality.
While Nestlé did not comment on any plans to establish a new manufacturing facility for Nescafé, an update is expected in the future.
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