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McDonald's buys out estranged India partner to end legal fight

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McDonald's Corp's bitter legal battle with one of its two India franchisees ended with the world's largest fast-food giant buying full ownership of the business that runs outlets in north and east India.

[MUMBAI] McDonald's Corp's bitter legal battle with one of its two India franchisees ended with the world's largest fast-food giant buying full ownership of the business that runs outlets in north and east India.

McDonald's India and its affiliate McDonald's Global Markets have acquired full ownership of Connaught Plaza Restaurants after reaching a settlement with its former 50:50 joint venture partner Vikram Bakshi, the Indian unit of Oak Brook, Illinois-based McDonald's said in a statement. It didn't give a value for the deal.

Indian businessman Bakshi and McDonald's have been at odds since 2013, the same year the local business of Domino's Pizza overtook McDonald's as the country's largest fast-food brand. The feud hampered the burger chain's expansion in the south Asian economy that is witnessing growing demand from the planet's largest youth population.

The dispute began after Mr Bakshi was voted out of Connaught Plaza in 2013 following which both partners sued each other in multiple courts. In July 2017, a court reinstated Mr Bakshi as the joint venture's managing director. McDonald's terminated its agreement with Connaught Plaza in August 2018. Still, the venture kept running its 169 outlets leading to more court cases.

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McDonald's restaurants in North and East India will be temporarily closed to conduct a comprehensive assessment of protocols and employee training. "The existing managers and crew will continue to be employed," it said in the statement.

McDonald's has two business entities in India. The largest venture is Hardcastle Restaurants, which operates McDonald's outlets in the western and southern parts of the country.

Effective immediately, Robert Hunghanfoo has been appointed as the head of Connaught Plaza, McDonald's said in the statement.

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