New Delhi: Vikram Bakshi, the estranged joint venture partner of McDonald’s India Pvt. Ltd, is planning to approach the Delhi high court on Wednesday, challenging a London arbitration court award that had asked him to sell his stake in Connaught Plaza Restaurants Ltd (CPRL) to the US burger chain.
LCIA, in an award passed on 12 September, had asked Bakshi to sell his stake in CPRL, McDonald’s franchise for northern and eastern India. LCIA had also called for the appointment of independent experts to determine a fair value for the joint venture, so that the US-based fast-food chain could buy out Bakshi’s stake.
CPRL, a joint venture between Bakshi and McDonald’s India, operates 169 restaurants across the country.
While McDonald’s had filed an appeal in the Delhi HC to enforce LCIA award earlier in September, Bakshi is filing an appeal to challenge the same, the latter’s counsel informed the National Company Law Appellate Tribunal (NCLAT) on Wednesday, during a hearing.
The tribunal was hearing two different appeals. One was brought by McDonald’s India against the NCLT order of July reinstating Bakshi as managing director of CPRL. The other was filed by Bakshi, requesting a fair valuation of the fast food chain’s outlets in northern and eastern India.
In light of the matters pending in Delhi high court, the tribunal adjourned the hearing to 16 November.
McDonald’s has been pursuing arbitration against Bakshi in LCIA since 2013.
In 2013, the company had voted against the re-election of Bakshi as managing director of CPRL, following which Bakshi challenged his removal in the Company Law Board (now National Company Law Tribunal or NCLT). Later in 2013, McDonald’s had revoked the joint venture agreement and invoked arbitration.
However, NCLT on 13 July reinstated Bakshi as the managing director and also asked McDonald’s Corp. to refrain from interfering in the functioning of CPRL.
This comes in the backdrop of McDonald’s India terminating its franchise agreement with CPRL on 21 August for all 169 McDonald’s outlets in northern and eastern India, citing non-payment of royalties as the primary reason. Bakshi was supposed to shut the restaurants from 6 September.
Up until now, all McDonald’s outlets have not only continued to operate, but Bakshi has also reopened 21 out of 43 outlets in Delhi that were shut in June due to the company’s failure to renew eating house licences.