Do you remember shut down of 43 out of 55 McDonald’s Delhi outlets only about two months ago? Now, McDonald’s India infighting has brought the company to a complete shutdown in North and East India.
For all of you completely unaware of the matter, there is an ongoing corporate battle between Connaught Plaza Restaurants (CPRL) and McDonald’s. Connaught Plaza is the company which handles all operations of McDonald’s in North & East India.
Why are 169 McDonald’s India outlets closing?
The company is already pursuing a legal battle with Vikram Bakshi, the MD of Connaught Plaza Restaurants. McDonald’s complains about non-payment of royalties from the franchise company and has also filed a case in London court. Further, Vikram Bakshi was removed from his position as the MD.
In July, NPCL restored Vikram Bakshi as MD of CPRL creating a strong hope for settlement in the company. However, the McDonald’s India infighting again turned bitter.
McDonald’s said that it is terminating franchise agreement with CPRL. This means that CPRL will not be able to use the logo, branding, trademarks and recipes of the company. Thus, all of the 169 outlets it operates will close down within next 15 days.
CPRL said that it is looking for available legal options while McDonald’s India has already started looking for a new partner.
How McDonald’s India operates?
The McDonald’s is an international burger giant with its headquarters in US. CPRL is a 50:50 joint venture between Vikram Bakshi and the McDonald’s which operates outlets in North and East India including Delhi. In South and West India, a different company called Hardcastle Restaurants Pvt Ltd manages the chain.
As a result of the legal battle, McDonald’s now has many challenges to face. Not only it is facing intense competition from both international and Indian companies in the market, but now it will go through a battle of existence.
Will you miss those burgers or fries?