McDonald’s India Pvt. Ltd has acquired full ownership of Connaught Plaza Restaurants Ltd after buying former partner Vikram Bakshi’s 50% stake, settling a dispute that had plagued the fast-food chain for more than five years.
Connaught Plaza and its affiliate McDonald’s Global Markets will be headed by Robert Hunghanfoo with immediate effect, McDonald’s India said in a statement on Thursday. It didn’t disclose terms of the deal.
Connaught Plaza is the master franchisee of McDonald’s in northern and eastern India, and runs 169 outlets. McDonald’s Corporation and Bakshi had formed the equal joint venture in 1995.
Problems between the two partners surfaced in 2013 when the US company removed Bakshi from Connaught Plaza citing mismanagement of the joint venture’s operations. Bakshi took the matter to court.
In July 2017, the National Company Law Tribunal (NCLT) termed Bakshi’s dismissal as illegal and asked the fast-food chain to appoint him as managing director of Connaught Plaza. Shortly after, McDonald’s Corp terminated its franchise agreement with Connaught Plaza and began searching for a new partner.
The company said on Thursday it “remains committed” to the opportunities in northern and eastern India and that it intends to actively look for a licensee for the regions.
Starting Thursday, McDonald’s restaurants in these two regions have temporarily closed for what the company said was to conduct a ‘comprehensive assessment of operational protocols and employee training’.
“Existing managers and crew will continue to be employed during this temporary closure and will be actively involved in activities to re-open the restaurants,” the statement said.