Burger King says Russia franchisee ‘refused’ to shutter restaurants -Breaking
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© Reuters. FILE PHOTO – Women walk past a Burger King in Moscow on September 15, 2015, Russia. REUTERS/Maxim Zmeyev/File photoHilary Russ
NEW YORK, (Reuters) – Burger King parent company stated on Thursday that it was unable to close 800 Russian restaurants because the independent operator in Russia “refused”.
Restaurant Brands International Inc (NYSE:) Inc claimed that in order to enforce the contracts it had with Alexander Kolobov as a franchisee, it would require the assistance of the Russian government. But, according to a letter sent to employees by David Shear, the president of international of the company, “we know that won’t practically happen anytime soon,” said Shear.
Kolobov could not be reached immediately for comment.
Shear’s lengthy letter highlights many of the problems facing American fast food brands trying to stop operations in Russia after Moscow’s invasion.
Restaurant Brands entered Russia in a joint venture partnership with Kolobov ten years ago. Shear stated that Restaurant Brands holds a 15% share in the joint venture.
Company has begun the process of disposing its stake in ownership. Shear indicated that it wants to make the sale immediately. However, the agreement stipulates that it may take “some time”.
Shear stated that there are no legal provisions that would allow them to unilaterally alter the agreement or permit any of the partners “to simply walk away from the entire agreement or to overturn it.”
“Would it be possible to immediately suspend Burger King’s operations in Russia?” Yes. Can we enforce a suspension? He wrote. “No.”
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