After McDonald’s India Pvt Ltd(MIPL) has terminated the licenses for 169 stores being operated by Vikram Bakshi, who is the Indian partner who owns Connaught Plaza Restaurants Ltd (CPRL) which operates the McDonalds franchise in North and in the East India ordering them to close the outlets, Bakshi started a fresh war saying that all the 169 outlets would remain open.
“The administrator appointed to the board of CPRL shall be requested to call for a board meeting at the earliest to discuss the termination of the franchise agreement. Till a decision is taken by the board of CPRL, it is business as usual,” Bakshi said.
“Following the NCLAT hearing today (Thursday), the termination notice remains effective as of September 6, which requires CPRL to cease the use of McDonald’s system and its intellectual property. We will continue to take steps to exercise our legal and contractual rights and enforce the termination,” MIPL said.
Justice G S Singhvi, the court-appointed administrator on the board of CPRL, asked both sides to await the NCLAT’s Thursday verdict before deciding the fate of the 169 stores. However if things doe not go in favour of McDonalds, they are ikely to move the Delhi High Court to enforce termination.
Around 6,500 people are directly employed by CPRL in 169 stores and their future is at brink. McDonalds is looking to write-off its investments of Rs.193 crores which it had pumped in towards non-convertible preference shares completely since both they and Bakshi (with Bakshi Holdings) hold an equal number of equity shares in CPRL.