Sacked by McDonald’s, Bakshi turns blame game aroun
11 Sep 2013
Vikram Bakshi, the ousted managing director of the north and east operations of McDonald's India, has accused Hardcastle Restaurants, which runs McDonald's operations in the west and south of the country, of influencing the US fast food chain "to take oppressive steps" against him.
Bakshi, who holds a 50-per cent stake in Connaught Plaza Restaurants Ltd, which runs the north and east operations, moved the Company Law Board (CLB) on Monday seeking a stay on his removal.
He faces allegations of land-grabbing, financial mismanagement and lack of commitment to promoting the joint venture.
In his petition to the CLB, Bakshi accused the American fast-food chain ''of implementing a pre-determined scheme of attempt to take over the company, Connaught Plaza Restaurants, in a coercive, oppressive and illegal manner, contrary to law''.
Bakshi has accused Amit Jatia of Hardcastle Restaurants (which operates McDonald's India in the West and South) and the parent company McDonald's Corp of ''colluding in easing him out of the position'' and also following discriminatory practices.
On 30 August, McDonald's said in a public notice that Bakshi had ceased to be the managing director of the joint venture – a post he has held for 17 years.
McDonald's entered India in 1996, forging two separate joint ventures - CRP and Hardcastle - to expand its operations in the country. Later, McDonald's sold its entire stake in Hardcastle to Jatia in 2011.
At the same time, it converted its operations into a franchise business for south and west India.
Apparently, Bakshi was keen on a similar buy-out for Connaught Plaza; but the burger chain did not allow it. Bakshi was also asked to keep CPR's debt at a certain level, while Hardcastle was allowed to increase its debt.
McDonald's said it found that Bakshi's other business interests, such as hospitality (Ascot Hotels and Resorts) and real estate, were in direct conflict with the joint venture.
There were also allegations that Bakshi illegally transferred Rs7 crore from the joint venture account to one of his group firms that has an interest in real estate. Earlier, allegations had been made against him of land-grab.
Bakshi claimed in his petition to the CLB that since 2008, when the joint venture started making profits, McDonald's had been trying to buy him out. The first offer was made in August 2008 for $5 million, which he said was ''categorically rejected''.
He further said his proposal for the appointment of a third party evaluation of his interest was rejected by McDonald's and instead the offer to buy his entire shareholding in CPR was increased from $5 million to $7 million.
A McDonald's spokesperson said, ''This is now a matter before the courts. We will address this in the appropriate forum. There is no further comment.''
