84 McDonald's restaurants in north, east India to reopen this week

New Delhi: Connaught Plaza Restaurants Pvt. Ltd (CPRL), the north and east India licencee of American fast food chain McDonald’s Corp., will reopen all 84 restaurants which were closed earlier in December on supply constraints by the end of this week.

CPRL is a joint venture between McDonald’s India Pvt. Ltd (MIPL) and Vikram Bakshi, and operates 169 McDonald’s restaurants across north and east India.

“Outlets in north India are already open and the ones in east will reopen by the end of this week. The movement of vehicles (supplies) is slow due to fog,” said Bakshi, managing director of CPRL. “By the end of this week, 167 McDonald’s will be operational, while two outlets (in Delhi) are shut for renovation,” he added.

In the last week of December, 84 outlets of McDonald’s in north and east India had to face closure after the company’s logistics partner Radhakrishna Foodland discontinued its services on 20 December, citing “reduction in volumes and uncertainty of the future” as reasons. Later that week, CPRL partnered with a new logistics firm ColdEx Logistics in a bid to resume the functioning of all restaurants.

ColdEx Logistics is a Gurugram-based cold chain company serving brands like KFC, Domino’s, Burger King, Subway, Starbucks, ITC, Nestle and Amul, according to the website of the company.

However, McDonald’s India had disapproved the new partner and raised food safety and quality concerns at all 169 restaurants in north and east India. “Since the termination of the franchise agreements, MIPL has not been able to verify if the unauthorized McDonald’s restaurants operated by CPRL in north and east India are complying with applicable McDonald’s standards, including those pertaining to supplies, operations and safety standards and quality required for McDonald’s products. These restaurants need to be closed immediately,” an MIPL spokesperson had said, in an emailed statement on 28 December.

MIPL declined comment on the new development which comes in the backdrop of an ongoing legal battle between Bakshi and McDonald’s India. On 21 August, McDonald’s India had terminated its franchise pact with CPRL, according to which Bakshi was supposed to shut all restaurants from 6 September.

The McDonald’s-Bakshi feud goes back to 2013 when the former had voted against Bakshi’s re-election as the managing director of CPRL. Bakshi challenged his removal at the Company Law Board (now National Company Law Tribunal or NCLT), accusing McDonald’s India of mismanagement and oppression. NCLT reinstated Bakshi as managing director in July 2017.

While McDonald’s India has challenged the NCLT order in National Company Law Appellate Tribunal or NCLAT, Bakshi has challenged the termination of franchise pact in NCLT, for being in contempt of the earlier order, which had asked McDonald’s to refrain from interfering in the functioning of CPRL. Both appeals are pending in respective forums.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.