Indian company India Hospitality was just a month ago linked to a buyout of coffee chain Barista Lavazza.
But now the company said the talks did not come to fruition citing they lack confidence in the business, which runs 180 cafes across India.
India Hospitality is chaired by Ravi Deol, a former CEO of Barista. The company has already acquired foreign chains including Adelie, a British maker of sandwiches and pastries.
Barista Lavazza faces heavy competition from local chains including Cafe Coffee Day, the largest coffee chain in India.
The competition in India’s coffee market will become even tougher as few foreign restaurant chains plan to expand offerings to include coffees to lure more customers. One of them is sandwiches maker Subway which plans to launch Subway Cafe.