In an unprecedented move, McDonald’s on Thursday shut down its 43 outlets out of 55 in New Delhi because of its ongoing tiff with the CPRL (Connaught Plaza Restaurants).
Vikram Bakshi, former managing director of CPRL, however, said that the company has temporarily shut 40 of its outlets all across the national capital.
“It’s correct that around 40 McDonalds restaurants have temporarily suspended their operations in the city of Delhi from today morning,” Bakshi told ANI in an exclusive conversation.
“This is a temporary shut down and not a closure,” Bakshi added.
Customers waiting to be served outside Mcdonalds.
In a statement, the Indian subsidiary of the US-based burger chain confirmed that “the eating house licences of a number of McDonald’s restaurants in Delhi have expired”. It added that CPRL is working to obtain the required licences.
“Pending this, CPRL is temporarily suspending the operations of the affected restaurants. McDonald’s is committed to ensuring that our restaurants are operating in full compliance with McDonald’s standards and applicable regulations. India continues to be an important market for McDonald’s and we are committed to working with CPRL to resolve the issue as soon as possible,” the statement from McDonald’s India Pvt. Ltd added. It did not elaborate on why the licenses had not been renewed.
Meanwhile, the Company Law Board is yet to pronounce its verdict in a case where Bakshi was removed from the post of managing director of CPRL in August 2013. McDonald’s has been pursuing arbitration against Bakshi in the London Court of International Arbitration, the ET report said.
Experts fear the closure of restaurants in Delhi will further hurt the prospects of McDonald’s which has seen its performance sliding in India, with pizza brand Domino’s replacing the company from its number one position.