McDonald’s India row: 126 outlets open, says estranged partner Vikram Bakshi
The fast food chain, however, has said that it will take action to enforce cancellation of its franchise licence.
As many as 126 McDonald’s outlets in North and East India continue to operate, the fast food chain’s estranged partner Vikram Bakshi said on Sunday, PTI reported. His comments follow McDonald’s saying it will take action to enforce cancellation of its franchise licence.
“Apart from the 43 outlets [in Delhi] that are shut for sometime, the remaining are open and operating,” Bakshi was quoted as saying. Outlets in Gurugram, Kolkata, Durgapur and Lucknow, operated by the Connaught Plaza Restaurant Limited – the 50:50 joint venture between McDonald’s India and Vikram Bakshi – were functioning. CPRL’s licence to run McDonald’s outlets in North and East India had ended on September 6.
A McDonald’s India spokesperson said they will take action to enforce the termination. “However, we will not be able to discuss specific plans or courses of action.”
The conflict
On August 21, McDonald’s India had cancelled its license agreement with Connaught Plaza Restaurant Limited. McDonald’s said it had been forced to end the partnership as CPRL had “materially breached terms of the respective franchise agreements relating to the affected restaurants, and failed to remedy the breaches”.
The joint venture between McDonald’s and CRPL first hit a roadblock when Bakshi was ousted in 2013 after McDonald’s voted against his re-election. Bakshi challenged his removal in the tribunal and was reinstated as managing director in July.
The closure of 169 outlets in north and east India could leave thousands of employees jobless. “This will cause widespread damage to the lives of 10,000 Indians, the company, the suppliers and all business associates,” Bakshi had said.
On September 7, the National Company Law Appellate Tribunal denied a petition filed by Bakshi for interim relief from the termination of the franchise agreement by the United States-based fast-food chain. The tribunal will hear two appeals in the case involving McDonald’s India and Connaught Plaza Restaurant Limited on September 21.