Vikram Bakshi Considers Legal Options After McDonald’s Cancels Franchise Pact
Vikram Bakshi says the timing of McDonald’s move is “hugely suspect”.
Vikram Bakshi, the estranged partner of McDonald’s India Pvt Ltd., said his company will consider “legal remedies” against the burger chain’s decision to terminate franchise agreement for 169 outlets in north and east India.
“This is a completely contemptuous, mala fide and yet another oppressive act indulged in by the McDonald’s corporation to sabotage the order of NCLT (National Company Law Tribunal),” Bakshi told BloombergQuint in a text message.
The restaurant chain has asked Bakshi-run Connaught Plaza Restaurants Pvt. Ltd. to cease using its system and associated intellectual property at the 169 outlets within 15 days of the termination notice. That’s more than a third of its total outlets in the country through two franchises – the other one being Hardcastle Restaurants, a subsidiary of Westlife Development Ltd., for west and south India.
.jpg?auto=format%2Ccompress)
The dispute with Bakshi began in 2013 when he was removed as the managing director of Connaught Plaza. He moved the NCLT against his ouster, which reinstated him in July this year.
Bakshi said that the timing of McDonald’s notice is “hugely suspect” because it comes on the morning of the first board meeting which was scheduled by the administrator – a former judge of the Supreme Court of India – and two foreign nominee directors of McDonald’s declined to attend, despite being given sufficient advance notice.
One of the items on the agenda was to discuss the reopening of the 43 restaurants in New Delhi whose operations were suspended.
The dispute will hurt the burger chain’s operations as it would have to look for another partner. Final resolution will “take time” and the company is “already looking at the necessary steps to rebuild the brand”, McDonald’s said in an emailed statement. It is “committed to finding the right developmental licensee partner for north and east India”, the company said.