McDonald's India has terminated the franchise agreement for 169 fast-food outlets in north and east India, run by Connaught Plaza Restaurant Ltd (CPRL). The outlets cannot use its brand for any operations, the fast food giant has said.
CPRL is led by Vikram Bakshi, the estranged partner of the US-based fast food chain. The decision comes weeks after 43 outlets run by CPRL in the national capital were shut due to the non-renewal of eating house licences by local authorities. CPRL was a 50:50 joint venture between Bakshi and McDonald's India.
As part of the termination, CPRL can no longer use the name, system, trademark, designs and intellectual property associated with McDonald’s within 15 days of the termination notice.
The termination of agreement includes all restaurants impacted by the recent failure to renew the eating house licences, the company said.
The popular food outlet has seen its fortunes declining since past few years over a tussle with Bakshi for the management of CPRL, after he was ousted from the post of managing director of the McDonald's franchisee in 2014.
We have been compelled to take this step because CPRL has materially breached the terms of the respective franchise agreement relating to affected restaurants and has failed to remedy the breaches, despite being provided with an opportunity to do so in accordance with the agreements.McDonald’s India
McDonald's India further said that it is "committed to finding the right 'developmental licensee partner' for north and east India and taking steps to do so".
(With inputs from PTI.)
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