New Delhi, May 10: After estranged partners McDonald’s and Vikram Bakshi ended their almost six-year-long dispute, the burger giant has decided to temporarily shut down 165 of its outlets in north and east India. On Thursday, McDonald's announced it has reached an out-of-court settlement with its estranged partner in India, Vikram Bakshi. With this, McDonald’s has bought out Bakshi's stake in Connaught Plaza Restaurants Pvt Ltd (CPRL) that operated chain of McDonald's restaurants in north and east India.  McDonald’s Loses Trademark Battle to Supermac’s, Here’s How the Whole Fiasco Began. 

Now as the deal is complete with Bakshi, CPRL is completely owned by McDonald's India Pvt Ltd (MIPL) and its affiliate (McDonald's Global Markets LLC, "MGM"), the company said in a statement. With the new agreement,  MGM has acquired the 50 per cent voting equity shares in CPRL that were held by Bakshi and his affiliated entity since the inception of the joint venture. This means, McDonald's India will continue to hold its 50 per cent voting equity shares in CPRL. All 84 McDonald’s Outlets of North and East India to Re-open by Weekend: Bakshi. 

McDonald’s-Bakshi Partnership

In 1995, McDonald’s and Bakshi had signed a partnership agreement to open outlets of the US fast food chain in India. The deal was for a period of 25 years.

The two partners had formed a 50:50 joint venture — Connaught Plaza Restaurant Ltd (CPRL) — which was responsible for outlets of the fast-food chain in the country’s northern and eastern regions through the franchise route.

The Tussle 

The battle between the two partners started after Bakshi was ousted as the managing director of CPRL in 2013, following which he approached the Company Law Board (CLB). He was later reinstated as the MD of CPRL by National Company Law Tribunal (which had taken over CLB functions) on July 14, 2017 following which McDonald’s approached the National Company Law Appellate Tribunal (NCLAT).

McDonald’s Terminated CPRL’s Franchise Agreement 

It was in 2017 that McDonald’s terminated CPRL’s franchise agreement citing non-payment of royalties. The legal tussle and battle for control of the business ensued afterwards with Bakshi keeping around 165 McDonald’s branded outlets operational in northern and eastern regions of the country.

As the agreement ended, the company also announced appointment of Robert Hunghanfoo as Head of CPRL with immediate effect, who will be supported by McDonald’s global leaders along with the CPRL team, to facilitate a smooth transition. On Monday, McDonald's and Bakshi had told the NCLAT that they are working towards an out-of-court settlement, to bring an end to their 5-year-old dispute.

(The above story first appeared on LatestLY on May 10, 2019 12:21 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).