McDonald’s, which in December posted its first-ever profit in India after 22 years of business, is now seeking to wrap up its long-drawn dispute with Vikram Bakshi, one of its two partners in the country. Bakshi’s Connaught Plaza Restaurants (CPRL) handles the fast-food chain’s 165 outlets in the northern and eastern regions through the franchise route. McDonald’s outlets in the southern and western regions are run by Amit Jatia-led Westlife Development.
This week the counsels for McDonald’s India Pvt Ltd and Bakshi told a two-member National Company Law Appellate Tribunal (NCLAT) bench that they are working towards an out-of-court settlement.
While addressing to media, Mr Bakshi said, “As has been reported, both shareholders are pursuing a settlement and I am sure you can appreciate, details of which cannot be shared at this stage.” Whereas the industry source said that the handover process is in progress. “McDonald’s will look to renovate and refurbish the outlets and rework the supply chain,” the source added.
“The search for a developmental licensee is in progress. However, we do not currently have any updates to share,” said Barry Sum, director, corporate relations Asia-Pacific, McDonald’s.
The bench, headed by Chairperson S J Mukhopadhyay, directed that either of the parties may file an affidavit including the terms of the settlement being arrived at on the next date of hearing, scheduled for May 13.
In 1995, the two partners had formed a 50:50 joint venture, CPRL, to open McDonald’s outlets in India for a period of 25 years. But things reportedly started souring in 2008, when the Chicago-headquartered giant tried to buy out Bakshi’s 50 percent stake. Matters further went downhill five years later, when Bakshi was removed as the Managing Director of CPRL. The National Company Law Tribunal (NCLT) subsequently reinstated him and also refrained McDonald’s from interfering in the functioning of CPRL besides appointing an administrator to oversee its operations.
But now these developments suggest that the curtains may come down on the over five-year-old dispute soon.