QSR Magazine: McDonald’s Closing Nearly 170 Restaurants in India

McDonald’s is shutting down 169 restaurants in the northern and eastern regions of India after a franchisee dispute. According to an article in QSR Magazine, the closures come as the fast food chain takes legal action against a partner—Connaught Plaza Restaurants Pvt Ltd (CPRL)—that it says breached its contract by defaulting on payments.

The issue between McDonald’s and this franchise operator is not new—the issues started back in 2013 when McDonald’s said that CPRL’s managing director, Vikram Bakshi, ended. While Bakshi challenged the decision in court, the fast food giant said that it believed he was involved in “irregular siphoning activities.”

In a statement cited by QSR Magazine, McDonald’s India said, “We have been compelled to take this step because CPRL has materially breached the terms of the respective franchise agreements relating to the affected restaurants.”

The McDonald’s closures could potentially mean that thousands of jobs will be lost, however, the brand says that it will try to lessen the impact on employees, suppliers and landlords.