British coffee chain Costa Coffee may break its partnership with India’s Devyani International.
The move comes after the Indian partner reportedly declined to invest more in a slowing economy. Costa Coffee is likely to sign a new partner to develop its brand, The Economic Times reports.
Devyani International, a part of RJ Corporation owned by Ravi Jaipuria, and Costa Coffee have been partners since 2005, operating more than 100 stores across the country.
The company faces stiff competition from local chains like Cafe Coffee Day, which has around 1400 cafes in India as well as foreign chains like Starbucks, which partnered with Tata Global Beverages.
Costa Coffee MD for international franchises, Andy Marshall, will meet executives from Devyani International in April to discuss the issue further.
The Indian coffee market is currently pegged at Rs1400 crore ($230 million) and is expected to grow 13-14 per cent over the next five years.