10,000 McDonald employees to lose job as burger chain shuts 169 stores in India

McDonald's has decided to cancel its agreement with CPRL over issues of fraud. McDonald's operates around 430 outlets in India through CPRL and Hardcastle restaurants, the company's franchise in the south and west. CPRL was surrounded by controversies since 2013 as it was allegedly involved in the misuse of funds

One of the most ppular fast food chains in India, McDonalds has difficult times ahead. Deciding to shut down 169 stores in India, the US burger chain decided to terminate its agreement with  Connaught Plaza Restaurant (CPRL)  due to breach in franchisee agreements.  CPRL is jointly owned by Vikram Bakshi and McDonald's India. This essentially means that 23-year-old CPRL, which also regulates operations in north and east India, including Delhi will not be able to use the chain's logo, branding, trademarks and recipes within 15 days of receiving the termination notice.

Meanwhile, a senior McDonald's executive, who did not wish to be quoted, said, "Each McDonald's outlet employs around 40-60 workers depending on its size. This excludes corporate employees and suppliers, including farmers who supply raw produce such as tomatoes, onions, lettuce and ingredients for sauces."

McDonald's operates around 430 outlets in India through CPRL and Hardcastle restaurants, the company's franchise in the south and west. The company has openly declared that it is looking for a new franchisee to replace CPRL. Following this, in an e-mail the company said, "We understand that this action brings uncertainty for many. It will take time to bring the current situation to a final resolution."

CPRL was surrounded by controversies since 2013 as it was allegedly involved in the misuse of funds. In fact, Bakshi was ousted as the CPRL's MD over alleged misuse of funds. However, he was reinstated in office by the National Company Law Tribunal in July. In fact, in the month of June, 43 McDonald's stores were shut down as CPRL failed to get the mandatory health licenses for the outlet. That seemed to be the final nail in the coffin as McDonald's was waiting for an opportunity to make the move.

Meanwhile, Bakshi, speaking to the Times of India said, "The timing of this notice is hugely suspect because it comes on the morning of the first board meeting, scheduled by the administrator (a former judge of the Supreme Court of India) appointed by the Hon'ble NCLT) and which the two Foreign Nominee Directors of McDonalds, declined to attend, despite receiving sufficient advance notice."