McDonald’s Corp said on Monday it began a process of selling all of its restaurants in Russia, leaving the country more than 30 years after it invaded Ukraine.
The world’s largest fast-food chain had decided in March to close its 847 restaurants in Russia, taking a hit of $50 million a month. It now expects to record a non-cash charge of around $1.2 billion to $1.4 billion after the sale. The decision to sell its assets in Russia, including the iconic Pushkin Square location in central Moscow, marks a major setback for an iconic Western brand.
Once a symbol of American capitalism flourishing in the dying embers of the Soviet Union, the store was the first to open in the country in 1990. More than 5,000 people attended the opening.
McDonald’s said it was looking to sell all of its restaurants in Russia to a local buyer, but would keep the brand. “The humanitarian crisis caused by the war in Ukraine and the precipitating unpredictable operating environment have led McDonald’s to conclude that continued ownership of the business in Russia is no longer tenable,” McDonald’s said.
Many other Western companies have agreed to sell their Russian assets or hand them over to local managers as they struggle to comply with sanctions over the Ukraine conflict and deal with Kremlin threats that assets belonging to foreigners could be seized.
The company said it would ensure that its 62,000 employees in Russia continue to be paid until any deal closes and have future jobs with any potential buyers.
(Reporting by Uday Sampath in Bengaluru; Editing by Sriraj Kalluvila and Arun Koyyur)
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